Probability and statistics have always fascinated me. I’ve never been a gambler–unless a $5 game of Texas Hold ‘Em with some buddies counts–but when I was a kid I would look eagerly in the sports section of the paper for the odds given on sporting contests. Even to a youngster, it seemed to make sense to me that a betting line would give you a pretty accurate prediction of how the contest would turn out. (Imagine if we could legally bet on events other than sports…)
My dad told me, “Don’t bother with gambling–no matter how good you think you are, the house always wins.” I knew he was right–how else could Vegas stay in business? Still, I wondered whether there were some sure-fire way to win–perhaps, to bet on a lot of different outcomes in the hope that one would win a big payoff.
This is certainly a false hope. If you bet on a contest between two teams, and you bet on both teams, you should come out even no matter who wins. If you bet on a field of participants in a race, the odds are always such that you can’t bet on everyone and actually come out ahead.
Take the current Super Bowl odds, for example:
Currently, the detested New England Patriots are the favorites. Oddsmakers are offering 6-5 bids for NE, which means that if you put up $5 and NE wins, you get back your $5 plus $6 winnings. Usually ratios are given in rounded numbers for ease (gamblers aren’t the smartest lot), even though each ratio in theory could be given relative to 1 (NE would be 1.2-1 in that case).
You can see that the oddsmakers have stacked the odds so that overall, they should win–as long as betting is fairly even across all teams. The third column in my chart is the amount you were to bet on each team such that your payoff plus the money you wagered for that team would add up to $1,000. If you placed on every team of the amounts given, you would spend about $1,390. Whichever team won, you would be guaranteed to receive back $1,000. This is a losing proposition, of course, and that’s the point…
So, if you were considering developing a gambling addiction next week: don’t.
♪ The more ♪ you ♪ know… ♪
I have a friend who is excellent at Poker. He goes on a cruise every year and pays for it by the amount of $$ he wins playing at casinos.
Poker’s a little different, because there’s quite a bit of skill involved. Especially if he’s playing with less-skilled or less-experienced wanna-be hustlers, he will probably win in the long-run–but the house wins off his opponents, too. Overall, the house still wins.