Edge

Does anyone have any information regarding how much more potent an edge of 1% would be over an edge of lets say .5%? Should one expect to win double over the long run? It seems like this is the most logical answer but was wondering if a higher winning percentage would yield even more when considering reinvesting your bank roll. I was just curious.

"Does anyone have any information regarding how much more potent an edge of 1% would be over an edge of lets say .5%? Should one expect to win double over the long run? It seems like this is the most logical answer but was wondering if a higher winning percentage would yield even more when considering reinvesting your bank roll. I was just curious."

Logically, you should make four times as much. Suppose you had a $10,000 bank. If you flat-bet optimally on each hand -- and forgetting about dividing by the variance -- you would bet $50 per hand. At 100 hands per hour, you would bet $5,000, and, with your 0.5% edge, you would make $25 per hour.

Now, with a 1% edge, your bet would be $100; you would make 100 such bets and therefore wager $10,000. With your 1% edge, you would make $100 per hour.

Clear?

Don

I understand. Also learning that with the increased edge, you are wagering twice as much. This is probably due to the lower ROR, right?

"I understand."

Somewhat. :-)

"Also learning that with the increased edge, you are wagering twice as much."

Yes.

"This is probably due to the lower ROR, right?"

No. ROR comes after you calculate your optimal bet, e.v. and s.d. If your edge is twice as great and you bet twice as much, you do nothing to change your ROR, which remains constant, since you double your variance, as well.

Don

How often do you get the chance to play bj? Do you keep track of your overall winning %? I'd have to imagine it is pretty good. Take care.

Your answer is correct for the initial bankroll, however, the question asked about winnings "over the long run." Let the players double their bet each time their bankroll doubles (or play true kelly) and the 1% edge player makes much more than 4 times the amount of the 0.5% edge player over the long run.

Dr 21