Two Plus Two Older Archives 10% refund question
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#21
11-27-2005, 03:29 PM
 AcmeSalesRep Junior Member Join Date: Aug 2004 Posts: 25
Re: 10% refund question

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Bet your whole deposit on a single bet. Let's ignore the 3/2 payout for BJ and assume that I win 49% of the time (this MORE than accounts for the loss due to not being able to double or split)...

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Actually it doesn't, that is the problem with your calculation.

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Just went to verify my numbers. I mis-remembered things slightly -- the 2% number is what no-double/no-split costs you (actually 1.91%), not the total house edge. So the total house edge ends up being 2.35%. But even with this HA, the rebate is a +EV situation for a single bet.

48.825% of the time you double up; 51.175% of the time, you end up with 10% of your bet. The EV is +\$2.76.

So despite all your protest to the contrary, a 10% rebate is a +EV offer.

Acme
#22
11-27-2005, 03:33 PM
 AcmeSalesRep Junior Member Join Date: Aug 2004 Posts: 25
Re: 10% refund question

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Bet your whole deposit on a single bet. Let's ignore the 3/2 payout for BJ and assume that I win 49% of the time (this MORE than accounts for the loss due to not being able to double or split)...

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Actually it doesn't, that is the problem with your calculation.

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That is not a big deal anyway. Bet half of your bankroll. Actually, I'm sure there is a spot between half and full bankroll that returns the highest EV, but none of this is really the point.

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I think betting the full amount up front gives the greatest EV...it costs you in HA and thus %EV, but not in \$EV.

Acme
#23
11-27-2005, 04:19 PM
 Jimbo Senior Member Join Date: Sep 2002 Location: Planet Earth but relocating Posts: 2,193
Re: 10% refund question

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So despite all your protest to the contrary, a 10% rebate is a +EV offer.

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And despite all your calculations the only thing I can agree with is that getting 10% of your losses back makes it less -EV but never +EV. After all if you end up losing money on your session you still lost. How can losing ever be +EV without a jackpot?

Jimbo
#24
11-27-2005, 04:28 PM
 Guest Posts: n/a
Re: 10% refund question

I didn't notice the cross-post, so I'm copying over most of my answer:

As has been pointed out, it all depends on the granularity. If it's per hand, it's a huge advantage -- you lose just over half your hands in BJ, so a 10% refund is worth over 5% overall. A 5% edge at BJ is unheard of.

But awarding it once per month is very different with many hands played. If you play 100,000 hands per month at \$10 each, and the house advantage at BJ is 1.0%, then you will have lost, on average, 1.0% x 100,000 x \$10, or \$10,000. Getting back 10% of that is a refund of \$1000, reducing the house edge from 1.0% to .9% -- so the refund is worth 0.01%. That's not a whole lot.

Somewhere between the two extremes is reality. If you chose to play just a few hands per month, ten or twenty, you're effectively playing just one tiny session. Odds are pretty high that the session will have some wild variance. If you win big, great. If you lose big, you get a big 10% refund. The advantage of 10% back on the loser makes it a net positive game.

To have the 10% effect big enough to make it a winning game, you have to play so few hands (per refund) that you're not experiencing a long term average at all. You have to be experiencing mostly variance. . . This can be fun if you enjoy individual gambles and you want to place some bigger wagers. If you can't afford that, or don't get a thrill from playing 10 or 25 hands per month, you can't pull off the +EV trick. If you play enough hands per refund, you are guaranteed a refund every month simply because you are guaranteed a loss!

In short, it's not a viable way to make money as a regular thing; again, it's only +EV when you play so few hands that you do NOT experience the EV at all; you experience the variance. That makes it simply a gamble, albeit a gamble with a +EV, which is a rare thing for most people. If you enjoy gambling a little, this is a great way to go. And if you enjoy gambling a lot, this is just a road to disaster which takes a little longer. If you don't enjoy the gamble at all, play something that doesn't involve money!

It would be interesting for someone to calculate roughly how many hands per month can be played with a 10% loss refund to equate to a real house advantage of 0%. I don't have the time to spare.
#25
11-27-2005, 04:46 PM
 AcmeSalesRep Junior Member Join Date: Aug 2004 Posts: 25
Re: 10% refund question

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So despite all your protest to the contrary, a 10% rebate is a +EV offer.

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And despite all your calculations the only thing I can agree with is that getting 10% of your losses back makes it less -EV but never +EV. After all if you end up losing money on your session you still lost. How can losing ever be +EV without a jackpot?

Jimbo

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OMG...you must be kidding me. Nobody can have &gt;3000 posts here and be this ignorant...so I am going to assume you are just a worthless troll and ignore you going forward...

Acme
#26
11-27-2005, 05:37 PM
 Benholio Senior Member Join Date: Jun 2004 Posts: 238
Re: 10% refund question

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So despite all your protest to the contrary, a 10% rebate is a +EV offer.

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And despite all your calculations the only thing I can agree with is that getting 10% of your losses back makes it less -EV but never +EV. After all if you end up losing money on your session you still lost. How can losing ever be +EV without a jackpot?

Jimbo

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So I offer to flip a coin with you, and if you lose you pay me \$95, and if you win, I'll pay you \$100. If you lose, you lost \$95. Does that mean it wasn't a +EV situation?
#27
11-27-2005, 06:28 PM
 Fraubump Senior Member Join Date: Sep 2002 Posts: 350
Re: 10% refund question

This problem is a tricky one. "Bet it all at once and it's +ev" was the first thing that occurred to me too. Ok, say you bet \$100 and lose. If you really think the proposition is +ev, nothing has changed. You still have exactly the same proposition. Why not make another bet if that proposition was +ev. The fact that you have already done it once cannot matter to whether doing it now makes sense. So, while I can't quite wrap my brain around it, I'm in the -ev camp on this one.

Let's imagine that the rebate on losses is 90%. This suddenly seems like a fantastic deal. Is it? I can easily imagine people bankrupting themselves trying martingales on this.

Anyway, I'm curious to see the definitive math on this.

One other consideration here is that Total Bet has a monthy casino bonus: I forget what the wagering req is, but if nothing else, this deal should increase the ev of clearing that bonus.
#28
11-27-2005, 06:31 PM
 Benholio Senior Member Join Date: Jun 2004 Posts: 238
Re: 10% refund question

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This problem is a tricky one. "Bet it all at once and it's +ev" was the first thing that occurred to me too. Ok, say you bet \$100 and lose. If you really think the proposition is +ev, nothing has changed. You still have exactly the same proposition. Why not make another bet if that proposition was +ev. The fact that you have already done it once cannot matter to whether doing it now makes sense. So, while I can't quite wrap my brain around it, I'm in the -ev camp on this one.

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The reason you can't keep making bets is because the refund if for the net result of all of your play. You don't get to play one hand, get a 10% refund, then play another. You don't get the refund on a per-hand basis, but only at the end of the qualifying period of time.

Back to your example, say you lost a hand, and decide to do it again, and now win a hand, you LOSE that 10% rebate that you were lined up to receive after the first hand, since you are not at a net loss now.
#29
11-27-2005, 06:39 PM
 Jimbo Senior Member Join Date: Sep 2002 Location: Planet Earth but relocating Posts: 2,193
Re: 10% refund question

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[ QUOTE ]
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So despite all your protest to the contrary, a 10% rebate is a +EV offer.

[/ QUOTE ]

And despite all your calculations the only thing I can agree with is that getting 10% of your losses back makes it less -EV but never +EV. After all if you end up losing money on your session you still lost. How can losing ever be +EV without a jackpot?

Jimbo

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So I offer to flip a coin with you, and if you lose you pay me \$95, and if you win, I'll pay you \$100. If you lose, you lost \$95. Does that mean it wasn't a +EV situation?

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Your example bears no comparison to the 10% rebate on your losses offer. What would be close though still not the same is this: We must each pay the house 50 cents everytime we flip the coins. If we flip a coin 100 times for \$100 per flip and then stop our session if I am behind, let us say 4 flips, which would equal \$400 in losses you will give me back \$40 and I will have \$410 less than when I started. If I am ahead suppose the same number of flips I just keep the \$400 I already won minus the \$50 in commissions so I have \$350 more than when I started.

The house will have a 1% edge everytime we flip the coins. All my example does is to take out the variance in BJ but the 1% HA stays similar to BJ.

An even better example is that you are flipping the coins with the house paying a 1% commission for every flip. If after 100 flips you won 50 and lost 50 you would be even except for the HA of 1%. You will have \$100 less than when you started so the house gives you back 10% of your commission after the session ends. You have a net loss of \$90 instead of \$100 but you still lost. Now suppose you won 51 flips and only lost 49 flips. In this case you win \$200 in flips but still paid \$100 in commissions with no rebate since you won the session.

Jimbo
#30
11-27-2005, 06:42 PM
 Fraubump Senior Member Join Date: Sep 2002 Posts: 350
Re: 10% refund question

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Back to your example, say you lost a hand, and decide to do it again, and now win a hand, you LOSE that 10% rebate that you were lined up to receive after the first hand, since you are not at a net loss now.

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Ok, that's the missing piece of the puzzle. So, maybe the way to play this is to organize a consortium: decide how much to risk and then all players in the group make a single wager of equal value on their accounts and then lump the results and share the profits. This removes the penalty for winning bets after losing ones.

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