Gambling

Suppose you go to Las Vegas or some other resort with the express purpose of gambling. The key question is: how do you manage your bankroll? All gamblers know that they cannot beat the game in the long run, whether it is craps (dice), roulette or punto banco. A rose is a rose is a rose, and the odds are the odds are the odds. So the answer depends on what you are hoping to get out of the experience. Is it to double your money? Is it to rack up one big win? Is it to relax over a few drinks before dinner? Is it to work up enough action to justify "comps" from the house?

Let us say you have set aside pounds 500 gambling money. If you plan to play, say, 10 sessions over the week, it is obviously no good betting it all on the first night. You must have the discipline to walk away if you get pounds 50 down. Likewise, if your aim is to double your money on a session, you should hit and run if you get lucky. OK, but suppose the dice are "hot"? Shouldn't the gambler press his bets? Yes, if the aim is to hit the one session of a lifetime when everything comes up right; but no, if the aim is to score a nice little win. ("One more bet" spells ruin in gambling.)

Computer simulation of craps presents a paradox. Suppose you have a starting stake of 90 units and want to win 45. Out of 100,000 sessions, you will win more than 47,000 times. If you raise your starting stake to 450 units, you will reach your target of getting 45 units ahead nearly 84,000 times out of 100,000, because you can play on longer. At first sight this looks pretty good. The snag is that the larger your initial bankroll, the more money you are going to lose overall, because each losing session wipes out your entire starting stake. The choice is between trying to win a small amount very often, with the risk of losing a big stake; or winning much less often, but reducing each losing session. Every gambler has to strike a balance, even though in the end either approach will send you home broke.