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This reminds me of "doubling" in Roulette. If you bet $1 and win you profit $1. If you lose, bet $2. If you win you win 2 - 1, if you lose you bet 4 and perhaps
by danteembermage 16y ago
This reminds me of "doubling" in Roulette. If you bet $1 and win you profit $1. If you lose, bet $2. If you win you win 2 - 1, if you lose you bet 4 and perhaps win 4 - 2 - 1 = $1. With an unlimited supply of capital you will earn positive returns for any reasonably positive probability of winning even if significantly less than 50%. Similar to the Parrondo's example the result requires bets that depend on capital which depend on previous iterations of the game and so the different games are not truly independent.
- BrandonM 16y agoThat's the Martingale System (http://en.wikipedia.org/wiki/Martingale_system http://en.wikipedia.org/wiki/Martingale_system), and it fails because no one has an unlimited supply of capital. Lose 20 times in a row and you've lost $2,097,151 since your last win. And you will eventually lose 20 times in a row. Since you're only winning $1 every time you win, you'll have to play many times to win any significant amount of money.