Ringo
03-10-2005, 07:56 AM
I've been reading about standard deviation, and am stuck trying to figure something out. Imagine a game, where one 6 sided dice is used. As the "house", if a 3,4,5 or 6 roll, I win, and a 1 or a 2 will pay out at even money. I know it`s not a very good game, but bear with me!
I was trying to work out how many games, with constant stakes, it would take to ensure a profit for the house - ie, how many games it would take to make a 99% chance (ie, 3 standard deviations) of the house coming out ahead. So..
.. I've been approaching the problem from this angle. I know I want to solve the SD formula for "n" (number of trials), so have been doing
SD = sqrt[N.(2/3).(1/3)]
..but, what goes on the left of the equation? To solve for N, there needs to be something. The expectation for the house is 0.66, and would I be right in saying that to ensure a win for the house, 3 SD`s must be less than (0.66-0.5)?
This type of problem can be applied to counting cards, can it not? Ie, if I only place bets when I have a >10% edge, whats the chance of me being behind after X trials, and how many trials it would take to ensure (within 3 SD`s) a profit. etc.
Can anyone help me out here? /images/graemlins/smile.gif
Ringo
I was trying to work out how many games, with constant stakes, it would take to ensure a profit for the house - ie, how many games it would take to make a 99% chance (ie, 3 standard deviations) of the house coming out ahead. So..
.. I've been approaching the problem from this angle. I know I want to solve the SD formula for "n" (number of trials), so have been doing
SD = sqrt[N.(2/3).(1/3)]
..but, what goes on the left of the equation? To solve for N, there needs to be something. The expectation for the house is 0.66, and would I be right in saying that to ensure a win for the house, 3 SD`s must be less than (0.66-0.5)?
This type of problem can be applied to counting cards, can it not? Ie, if I only place bets when I have a >10% edge, whats the chance of me being behind after X trials, and how many trials it would take to ensure (within 3 SD`s) a profit. etc.
Can anyone help me out here? /images/graemlins/smile.gif
Ringo