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Old 10-26-2005, 03:32 PM
King Yao King Yao is offline
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Join Date: Mar 2004
Posts: 156
Default Hedging

There are three reasons to make a bet that hedges a previous bet:

1. The second bet - the hedge - has positive expectancy itself.

2. Your risk is so large, that you'd get sick to your stomache (or your wallet) if you lose.

3. The hedge itself allows you to play other related plays (that have positive EV) that you found too risky to play combined with your current position. But the combination of this new positive EV play and the hedge, must have positive EV.

In your case, it seems the only relevant issue is #1 - does the hedge have positive EV. So, would you bet against USC now if you didnt' have the USC bet to begin with?. I'll leave that answer to you and other posters.
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