It doesn't take a simulation to tell you that if you have the advantage, you will win more money the more you play. While stop loss and stop win strategies may have psychology effects, they have no mathematical basis.
If you reduce your hours, you reduce your expected value.
Ok. I understand what you mean, but I suppose I am trying to see if it is worth trying to capitalize on positive flux.
While you are sitting there enjoying your "positive flux," you could be at the tables making more money.
Now, let's say one would play as if they were a day trader and capitalize your up stocks and limit losses. Say you made 10 one hour trips. You win 4 at $100 and you lose 4 at $60 and for the math, lets say you break dead even on the other 2 trips. Playing this way, where you capitalize on your + flux and leave with the $100 or leave when $60 is lost, you end up earning $16 per hour.
What about the times you are up $100, but would have be up $200 had you continued playing? Or, down $60, but would have recovered? See above equation: EV = (EV/hour)*hours
So what I wanted to do, was verify with CVCX or CVdata what would happen if someone did the above, but verify it over a large amount of hours back counted.
Do you really expect CVCX to have a result that is different than EV = (EV/hour)*hours? Norm doesn't write voodoo software.
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
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EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
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EV = (EV / HOUR) * HOURS
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EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
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EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
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EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
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EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
EV = (EV / HOUR) * HOURS
The math doesn't change no matter how time you try.
The main difference between trading and BJ is that all of the odds are well known and well understood. The stock market is not predictable. That's a fundamental difference.
that in the market you can use technical analysis to predict whether the market is going to go up or down because emotion and other non-mathematical factors affect the market. Such analysis cannot be applied to blackjack and that is exactly what someone using a stop-loss is attempting to do.
With blackjack either you have an edge or you don't have an edge, everything else is luck.
either you have an edge or you don't have an edge, everything else is luck.
Regards,
PM
I know I'll get flamed for this post, but stoplosses do have a mathematical basis and value.
While it is true, in theory, that you can calculate your advantage based upon the rules available, your counting system, and your betting ramp, this is a theoretical calculation. If you have a computer playing for you against a computer dealer and you don't have to worry about getting the tap, then you will achieve this result in the long run.
In practice, blackjack is played by organics. Some casinos cheat (not much of a problem in the US), capable dealers can take a dislike to you, you may have to make cover plays and, biggest problem of all, the player is fallable - you can have a bad day. Because of these, your advantage is stochastic, not deterministic.
If you allow your a priori advantage on any day to be a distribution that has negative values, then a stoploss may have positive value. It may also not have a positive value - it depends upon the distribution.
The reason math-nerds don't take over the world (despite the hubris evidenced in prior posts) is that they invariably fail to account for human factors. That's also why, despite the elaborate models developed by a lot of people with fancy degrees from expensive schools, you get results like what happened at Bear Stearns. Unfortunately (or not - I think it's fortunate), the world is full of these factors. Some of those factors can be modeled, but you have to understand them rather than simply reciting the theory you've read in a book.
Great post MrFellow,
You ended with: "Some of those factors can be modeled, but you have to understand them rather than simply reciting the theory you've read in a book."
Or several books, I add, all from experts presenting the same stuff with varying slants and views. Reading and reciting theory is fine, but understanding (at a deeper level) is entirely another matter.
The bane of Blackjack counters is variance and flux.
Understanding these two is beyond most of us, and even if we did understand, would anything change in how to deal with them?
A deeper understanding of the nature, characteristics and behaviour evident in the game of blackjack reveals at least one causal clue encapsuled in this word: randomness.
This inherent randomness factor of the game, combined with human fallibility, unpredictable emotions, wavering
concentration and focus, alcohol intake...the list of possibilities
goes on and on...makes you marvel at that wonder of nature: a consistent and regular AP winner at BJ.
Regards NB
He was trying to comparing with strategies used by day traders, hoping there would be a mathematical justification.
I think the responses embarrassed him into removing his posts.
If you allow your a priori advantage on any day to be a distribution that has negative values, then a stoploss may have positive value. It may also not have a positive value - it depends upon the distribution.
I don't understand this. Suppose you experience a negative or positive swing. What is the difference between stopping now to resume tomorrow, or continuing to play now? The only difference from a mathematic perspective, is that you limit the number of hours in the former. EV=(EV/hour)*hours. There may be other reasons to stop, but none are based on mathematics and certainly would not be borne out the simulations requested by vmiman.
The reason math-nerds don't take over the world (despite the hubris evidenced in prior posts) is that they invariably fail to account for human factors.
You're right, Bill Gates is now only the second richest person in the world.
That's also why, despite the elaborate models developed by a lot of people with fancy degrees from expensive schools, you get results like what happened at Bear Stearns. Unfortunately (or not - I think it's fortunate), the world is full of these factors. Some of those factors can be modeled, but you have to understand them rather than simply reciting the theory you've read in a book.
You are right that the mathematics presents an ideal situation, unacheivable in real life. What you fail to understand is that to maximize your expectation, you need to emulate this ideal as close as possible. Any deviation, whether it be due to errors, voodoo strategies, or other circumstances, will reduce your expectation.
FWIW, my financial investment strategy to invest regularly in the Fidelity Freedom Funds tied to my expected retirement date. The investments are spread over tens of thousands of stock funds worldwide, bond funds, and cash funds. The allocation is based on the ideal ratio of return vs. risk for my age. I don't worry about the daily, monthly, or even yearly ups and downs -- these will even out over the long run.
On the subject of:
If you allow your a priori advantage on any day to be a distribution that has negative values, then a stoploss may have positive value. It may also not have a positive value - it depends upon the distribution.
I don't understand this. Suppose you experience a negative or positive swing. What is the difference between stopping now to resume tomorrow, or continuing to play now?
- Here's a simplified example to illustrate what I am saying. Suppose you believed that there was a 10% chance that the casino cheats. Unlikely, but for the sake of illustration. Then if you hit your stoploss, Bayesian analysis would suggest that the probability that this is a cheating casino is something higher than 10%, and this would change your analysis of whether you had an advantage, n'est pas?
Although the chances of cheating are small in the US, as I noted there are other potential reasons that you can't know beforehand and which would mean that you might not have an advantage on a particular day.
On the subject of:
You are right that the mathematics presents an ideal situation, unacheivable in real life. What you fail to understand is that to maximize your expectation, you need to emulate this ideal as close as possible.
- Oh I understand it. What you're failing to understand is that you can't possibly model everything in a system that is not closed. (If you don't believe me you can read a book called "Godel, Escher, Bach".) At some point you have to question whether your model is an adequate reflection of the situation, or as they say out west, "when your horse dies, get off."
Here's a simplified example to illustrate what I am saying. Suppose you believed that there was a 10% chance that the casino cheats. Unlikely, but for the sake of illustration. Then if you hit your stoploss, Bayesian analysis would suggest that the probability that this is a cheating casino is something higher than 10%, and this would change your analysis of whether you had an advantage, n'est pas?
How does one arrive at the conclusion that there is 10% chance the casino is cheating? Are there 10 casinos and someone tells you that exactly one is cheating? If you are basing it on whether you win or lose, you have a lot to learn about variance. It sounds like my brother, who was flat betting $10 at a strip casino. He didn't know BS. He was up $300, but started to lose after they changed the dealer. He figured they must have been cheating (even though he was ahead when he stopped).
(Personally, if I suspect a casino is cheating, my stop-loss is 0.)
and hence missing the point. Don't know if reading comprehension is the problem because this is also symptomatic of something I alluded to in my original post, which is that, for a lot of math, the underlying theory doesn't have to be understood to apply it.
By the way, on the subject of understanding and the big picture, if you think Bill Gates got rich because he's good at math, then it's a good idea for you to stick with a target date mutual fund.
I present a challenge between someone using a target date mutual fund with dollar cost averaging and 1000 people using marketing timing and other voodoo techniques.
Given equal funds, I can guarantee that the target date mutual fund investor will outperfom most of the other investors. Oh, there may some lucky ones that will have much greater than expected results, but the majority will fall short, and many will lose it all. I've seen it happen to friends and family investing in Enron, mortgage companies, and real estate -- they would not listen. Investing, like advantage play, is a balance between return and risk. Unfortunately, most don't know how measure risk.
Compare playing blackjack on a day to day basis versus trying to win a blackjack tournament. In a tournament you try for abnormal outcomes in an effort to stand apart from the rest. To the uninformed, it would seem that that is how one should play on a day to day basis. However, it should be obvious that it isn't.
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