Monte Carlo methods – Why it's a bad idea to go to the casino • Hacker News Board

Re: Monte Carlo methods – Why it's a bad idea to go to the casino

#91

Post by dtech » Fri, Jul 05, 2019, 8:47 AM UTC

noego wrote: post #51

55555 wrote: post #11

It's more complicated (worse) than this. That the house has a small edge only tells a small part of the story. When people go to vegas for a weekend, they might have a number in their head they are willing to gamble. If they dont, then that number is their bank account balance. Then they start flipping coins, and often they keep doing this until they go bust. They rarely cash out when up but they always lose when the…

You hit the nail on the head. If you simply play the pass-line and free-odds on craps, the house edge is extremely small. And yet, most people lose far more than predicted by the odds. The problem is exactly as you stated - people don't have a defined exit-strategy, and their implicit exit-strategy is to keep playing till they lose everything. Which is guaranteed to happen 100% of the time even if the house-edge was…

I rarely gamble, but when I do I like the following strategy:

Start with X. Whenever you get above X, skim the surplus and store separately.

You've now capped your losses at X (aka the price of the game night) and feel like you're winning when you can skim some money off your pool.

Re: Monte Carlo methods – Why it's a bad idea to go to the casino

#92

Post by DarkWiiPlayer » Fri, Jul 05, 2019, 8:49 AM UTC

roenxi wrote: post #2

I have a pet peeve about Monte Carlo methods; although it might be more fairly characterised as a rookie mistake I saw once. MCM are not strong if the tail variance isn't an important feature of what is being modeled. I've seen simulations where the modeler starts with an analytic model - from which they could trivially calculate the mean and variance of a KPI - then used a MCM simulation to find out essentially what…

I once was in a situation where I had to hammer in a nail with a screwdriver (grabbing it by the front, hitting with the grip). The feeling I had back then is one I all too often experience again in programming.

This example isn't so much different; MCM = screw driver, problem = nail and learning proper statistics = driving to the hardware store and buying a hammer.

The only aspect where the comparison is somewhat lacking, is that the costs of having a hammer (both aquisition and storage) are minimal compared to in-depth knowledge about statistics.

Re: Monte Carlo methods – Why it's a bad idea to go to the casino

#93

Post by doomjunky » Fri, Jul 05, 2019, 9:04 AM UTC

paulcarroty wrote: post #90

It's absolutely obviously for people who know the basics of Probability theory. Not sure if modern high schools covers it now. But it's only a part of the problem. Second part - money and gaming easily can be addictive like drugs.

Everything that makes your brain feel good, can be addictive.

Not the drugs are addictive, feeling good is.

Re: Monte Carlo methods – Why it's a bad idea to go to the casino

#94

Post by lelima » Fri, Jul 05, 2019, 9:13 AM UTC

chongli wrote: post #49

daveFNbuck wrote: post #40

Earlier quoted context omitted.

People playing until they go bust doesn't actually affect the casino's take, except insofar as it means more people are gambling. If someone leaves when they're up and someone else takes their place at the table, the casino makes exactly as much money as if the first person hadn't left.

Yeah. I think casinos would prefer not to inflict financial ruin on their patrons. Apart from the bad PR (and potential for political interference), a bankrupt patron seems less likely to come back to the casino with more money.

That's true, We used to give free credits/ chips if they lose too much too quick. Casino's want long term relationships.

Re: Monte Carlo methods – Why it's a bad idea to go to the casino

#95

Post by homero » Fri, Jul 05, 2019, 9:14 AM UTC

ojbyrne wrote: post #61

eric_h wrote: post #54

Earlier quoted context omitted.

> If they would allow me to play a +EV game If a business offered a positive EV gambling game, it wouldn't be called a casino and would only last as long as the venture capital lasted.

Actually there are still +EV video poker games in Vegas. http://www.slotsmamma.com/blog/how-do-you-find-full-pay-deuc... There are a few catches though. Mostly if you play perfectly (which is not simple) the most you can expect to make is less than eight dollars an hour.

That's a good job for making the casino look more active. Just letting someone win $8/hour

Re: Monte Carlo methods – Why it's a bad idea to go to the casino

#96

Post by lelima » Fri, Jul 05, 2019, 9:19 AM UTC

55555 wrote: post #11

It's more complicated (worse) than this. That the house has a small edge only tells a small part of the story. When people go to vegas for a weekend, they might have a number in their head they are willing to gamble. If they dont, then that number is their bank account balance. Then they start flipping coins, and often they keep doing this until they go bust. They rarely cash out when up but they always lose when the…

>>Gambling is the only vice where you can lose billions.

That is not far from truth, I use to work for a company that owned several Casinos, we use to have "whales" spending more than 100k each month, sometimes they lost everything so quick that we gave them 50% back or trip to Bahamas / Paris, Anything to keep them happy and coming back.

Re: Monte Carlo methods – Why it's a bad idea to go to the casino

#97

Post by dorgo » Fri, Jul 05, 2019, 9:23 AM UTC

mongol wrote: post #69

TBurette wrote: post #50

A while ago I wrote a similar interactive article to prove that the martingale betting technique at the roulette doesn't work : [1]. The martingale is when you bet 1, double the bet each time you lose, start again at 1 when you win. The aim was to create a single page anybody could link to that proves without a doubt the abysmal odds of making money off the roulette with the martingale technique. Instead of pre-writt…

Theoretically I learned it works, but only if you have unlimited funds.

Wait, what could you win if you already have unlimited funds?

Re: Monte Carlo methods – Why it's a bad idea to go to the casino

#98

Post by SmellyGeekBoy » Fri, Jul 05, 2019, 9:35 AM UTC

lanrh1836 wrote: post #16

Blackjack on the strip has become a boiling frog of sorts. Everytime I go back the rules are tweaked a little more in the house’s favor. 3:2 payouts for Blackjack were gone years ago, but more recently no even money for Blackjack if dealer shows an Ace, only split once for two Aces...not worth it at that point.

In the handful of times I've been into casinos here in the UK I've always just stuck to the Blackjack table (I used to play it with my grandma for buttons when I was a kid). Every time I've walked away with more money than I started with. My biggest profit was over £500.

The one and only time I was convinced to give roulette a try I lost everything pretty quickly (I mean the small pot I'd set aside for gambling - I'm not stupid enough to keep withdrawing money and bet more than I can afford).

Seems blackjack can be pretty lucrative if you're willing to walk away at the right moment. I seriously doubt it would work as any kind of long term strategy, however. Of course you also have to have the discipline to spend the rest of the night drinking beer and watching your friends get poorer and poorer.

Re: Monte Carlo methods – Why it's a bad idea to go to the casino

#99

Post by SmellyGeekBoy » Fri, Jul 05, 2019, 9:39 AM UTC

OscarCunningham wrote: post #63

spaceflunky wrote: post #60

It's (relatively) easy to show the math on why casino games are impossible to win, but what about sports betting? Does the house always have the advantage? Perhaps it's slightly better for the gamer? FWIW I was looking a betting website recently [0] and they were offering DOUBLE your initial deposit for signing-up, up to $1000. So to reiterate, they are willing to give up to $1000 for FREE just for creating an accoun…

>Does the house always have the advantage? The mathematics doesn't really matter because if you find a systematic way of winning then they just ban you.

So... yes?

Re: Monte Carlo methods – Why it's a bad idea to go to the casino

#100

Post by learnstats2 » Fri, Jul 05, 2019, 10:03 AM UTC

My experience of going to high-end casinos, mostly in London, is that:

- Many players were plainly cheating in some way, by marking cards and sometimes colluding with the dealer, but the casino didn't appear to mind because they were cheating in an ineffective way and still losing money to the house edge.

- (Related: you would just be banned if you won an amount of money that showed you were beating the house edge: see also the Phil Ivey lawsuit)

- Some players were gambling large sums of money generally on games with a small house edge, and looked bored like they were there to do a job. I assume from their behaviour they were laundering money.