the lottery, it COULD be +ev

[blaze666]

you know rollovers, where no-one wins one week, so the money get's added onto the the next week, surley if there was a vast amount of rollovers in a row, then it could be +ev to play

let's say every week 100 people enter (and let's a assume that this number always stays the same), and it costs £1and the chances of winning is 1 in a hundred, and the prize money is £30, if it get's rolled over 4 times, then the prize money would be £120, with a 1:100 chance to win, thus it would be + ev to play. in real life, would you have thought this was possible? and how many times would it have to roll over for it to be +ev?

[MrX]

it can be. There was a large organized group from Australia who bought all the combos in the Virginia lottery when it becam +EV.\

I may be wrong on the details here but it has been done.

x

[moomoocow]

I think a couple of things make an +EV very unlikely -

1. Taxes - I don't know about the UK, but in the US the money you spend is not tax deductable (at least I don't think so) and your winnings are

2. Game theory dictates that (rationally) more peopel will buy tickets as EV gets positive, so chances of splitting a win go up - which completely destroys EV.

That being said - Does it matter if a lottery is EV positive or not? If you win, you're winning say either $10Mil or $20Mil - do you care?!

[pzhon]

[ QUOTE ]
you know rollovers, where no-one wins one week, so the money get's added onto the the next week, surley if there was a vast amount of rollovers in a row, then it could be +ev to play

[/ QUOTE ]
This has been considered a lot.

Actually, when the jackpot is huge, it may result in a disproportionately large number of entries. That may make it a worse deal than when there is a medium-sized jackpot.

[ QUOTE ]

and how many times would it have to roll over for it to be +ev?

[/ QUOTE ]
To estimate the expected value, estimate the probability that someone will win (you may have to estimate the number of entries from the increase in the jackpot over the previous drawing). Then, assume that if the jackpot is won, it is evenly distributed among the tickets.

[ QUOTE ]
let's say every week 100 people enter (and let's a assume that this number always stays the same), and it costs £1and the chances of winning is 1 in a hundred, and the prize money is £30, if it get's rolled over 4 times, then the prize money would be £120, with a 1:100 chance to win, thus it would be + ev to play.

[/ QUOTE ]
No, it would not be +EV. The probability at least one player wins is 63.4%, so on average, you get 1/100 of 63.4% of either £120 or £150, depending on what you meant above. In either case, that is worth less than £1.

Be careful that in real lotteries, the jackpot is overestimated, and the present value is often much less than the nominal value, and you may have to pay taxes. Nevertheless, there have been cases in which a group of people bought every combination, and in some cases they may have done this correctly.

[pzhon]

[ QUOTE ]
it can be. There was a large organized group from Australia who bought all the combos in the Virginia lottery when it becam +EV.\

[/ QUOTE ]
IIRC, that group messed up in more than one way. First, they accidentally didn't buy all of the combinations. Second, they incorrectly assumed they would not have to pay taxes.

[danzasmack]

boch

[blaze666]

[ QUOTE ]
I think a couple of things make an +EV very unlikely -

1. Taxes - I don't know about the UK, but in the US the money you spend is not tax deductable (at least I don't think so) and your winnings are

2. Game theory dictates that (rationally) more peopel will buy tickets as EV gets positive, so chances of splitting a win go up - which completely destroys EV.

That being said - Does it matter if a lottery is EV positive or not? If you win, you're winning say either $10Mil or $20Mil - do you care?!

[/ QUOTE ]

1. i said that assuming the number of entries are fixed, and i think this would hold more or less tru in real life, as it's the same people who buy lottery tickets every week.

2. im not talking about EV as in how much can i win in the long term, as a +ev situation will come up as often as an eclipse, im talking about doing what that group did, and buy all the combinations, so if it goes to £200mil, and it only costs me £100 mil to buy ALL the combinations.

[LetYouDown]

The main problem you'd run into in larger lotteries is that more people buy tickets. The odds that you're the only winner drop significantly. Yeah, you may be able to buy all the combinations for $100 Million and the payout's $200 million...but not if 7 people have that number.

[Little Fishy]

not exactly what you're talking about, but a few years ago the NY lottery messed up and payed double on the 5 slot at keno for 4 wendsdays in a row as a promo thing... the bet became +EV and some people who cuaght on took advantage of it... similar things have happened elsewhere...

due to increasing entries + taxes + possibility that you'll split, i doubt the lotto will become +EV due to rollover... but sometimes the lotto is +EV only it's because of mistakes

[AaronBrown]

Gambling losses, including losing lottery tickets, are deductible only against winnings. So you can use them to reduce your taxes if you win, but not to reduce taxes on your other income.

Another way to get a positive expected value is to bet unpopular numbers. When the rollover gets big enough, you can get a significant edge that way. However, you can't use that to buy up all tickets, you have to be happy in the knowledge that you have the same 1 in 10 million chance as everyone else, but you're likely to keep the entire jackpot if you win instead of having to split it.