6 ms·
From wikipedia: "It is therefore a good example of a Taleb distribution – the gambler usually wins a small net reward, thus appearing to have a sound strategy.
by redthrowaway 14y ago
From wikipedia:
"It is therefore a good example of a Taleb distribution – the gambler usually wins a small net reward, thus appearing to have a sound strategy. However, the gambler's expected value does indeed remain zero because the small probability that he will suffer a catastrophic loss exactly balances with his expected gain."
- AncientPC 14y agoCorrect, I skimmed the Wikipedia article too quickly. It is a neutral outcome.
- cygx 14y agoThe quote is out of context: In case of infinite reserve (and infinite time to place your bets ;)), there are no catastrophic losses which would stop you from betting again. The problem with always doubling your wager is that the exponential growth will eventually reach any finite limit in case of a run of 'bad luck'. Without limit, that's not an issue and you'll only lose when you never win any bet, which 'almost surely' won't happen.