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Here's a cheatsheet: Vegas expectations = always negative, no matter how much time or thought you put into it Private investing expectations = usually negativ
by gojomo 12y ago
Here's a cheatsheet:
Vegas expectations = always negative, no matter how much time or thought you put into it
Private investing expectations = usually negative, but sometimes positive (and more likely positive with experience and effort, or within domains of personal expertise)
So why is the first a better deal to open to everyone without regard to wealth, whereas the second is so dangerous it must be encumbered with wealth-tests (not knowledge/skill/credential tests) and major legal barriers/overhead costs?
Here's an idea: let anyone invest, on the same basis as a traditional "accredited investor", whatever amount of cash they could also obtain, via withdrawals or loans, at a casino cashier cage. If it's OK to hand someone $10-20K in chips for negative-expectation games, why not let them invest $10-20K in maybe-positive-expectation learning experiences, without prejudice?
- alasdair_ 12y agoPoker in vegas has +EV in the right circumstances, as does card counting blackjack when coupled with player reward bonuses. Hell, roulette with a martingale system has a positive expectation if you have more money than the house and the bet size is unlimited.
- notahacker 12y agoRoulette with a martingale system has exactly the same expectation as roulette without a martingale system, just a slightly different distribution of returns. Having more money than the house certainly isn't an advantage when you've lost 16 times in a row and they can't honour your next bet...
- gojomo 12y agoSo occasional +EV situations in Poker and Blackjack for a tiny fraction of the most disciplined players (and only at the direct expense of others) are why non-rich people are allowed to wager their entire life savings at roulette, lottery, and slot machines? And then even more than their net-worth, via lines-of-credit? But then those same people – no matter how disciplined – must face large (practically insurmountable) paternalistic legal barriers against putting even a few dollars into private investments? Even in domains where they have personal expertise? And where the results can be positive-sum for all involved, rather than strictly zero- or negative sum? The nonsense is still strong in the dichotomous regulation of gambling and investments. It's almost as if the paternalists want to protect poor people from becoming wealthy!