gambling.
Kelly Critereon is a mathematical method for maximizing the rate of bankroll
growth at a +EV game with a known edge and variance. It's not designed to
ensure you don't bust your bankroll. Also, the model assumes you can vary
your betsize at continuous increments (i.e., you can bet $0.27 a hand or
$0.09 a hand if the model asks you to) where real gambling usually involves
fixed tiers of stakes.
99%+ of people who gamble shouldn't even be thinking about Kelly. Why?
Because:
1. They don't play +EV games
2. They do play +EV games, but they can't really quantify their edge and/or
variance
3. They play +EV games with a fixed edge and variance, but they are more
concerned with making sure they don't bust their bankroll rather than
maximizing its growth rate.
Even professional gamblers typically aren't trying to maximize bankroll
growth rate because they are withdrawing a fixed amount from the bankroll
each month.
So the long answer to the original question is, no, there is essentially no
mathematical reason whatsoever to increase or decrease your wager size based
on your recent results. If it makes you happy to do so, then go for it. But
it's not "+EV" in any meaningful sense of that term.
Ed
On Tue, Sep 20, 2011 at 5:07 PM, Bob Dancer <bobdancervp@hotmail.com> wrote:
> **
>
>
>
> NOTI noted, with respect to multi-hand games: Varying number of hands
> played is EV neutral, but it does effect average bankroll growth. The
> approximate Kelly optimum is to bet edge/variance of your current bankroll.
> This is true for many but not al multi-hand games. Games like Triple Play,
> Five Play, Ten Play, Fifty Play, Hundred Play, and Super Times Pay, plus
> others, are EV neutral. Multi-hands such as Multi Strike, Ultimate X, Wheel
> Poker Deluxe, and Extra Action Poker, plus others, are NOT EV neutral.
>
>
> In most cases, whether you're winning or losing today should have nothing
> to do with your betsizing --- except in the probably rare cases that your
> gambling bankroll at the start of the day was barely enough to play a
> certain level (and you should move down if you're losing) or barely not
> enough to play at a certain level (and you can move up if you win.) Assuming
> we define bankroll as "the amount of money you can lose before you quit
> gambling," most players don't have an exact bankroll number for themselves
> anyway. Who among us can say, "If I lose $23,458.33 I'll quit forever and
> ever amen. Not one penny more!" We can say that BEFORE we begin that losing
> streak, but if and when that time actually gets there (assuming we can
> recognize the exact moment when our bankroll reaches such a level), many
> people will adjust their "drop dead' figure. Far more important than whether
> you are ahead or behind today is are you playing a game where you have the
> advantage? No stop-loss or bet-sizing strategy can make up for playing a bad
> game. When NOTI was talking about Kelly betting, this assumes a positive bet
> edge. A large number of players neglect the importance of this fundamental
> fact.
>
> Bob
>
> [Non-text portions of this message have been removed]
>
>
>
[Non-text portions of this message have been removed]
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