this post was submitted on 24 Oct 2023
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[–] [email protected] 2 points 1 year ago* (last edited 1 year ago) (3 children)

Make smaller bets that are more likely to win and that have smaller risks of downside for a higher "guranteed" positive return rate. β€”Me (my understanding)

Is this an accurate understanding? Like focus on additive gain rather than trying to "hit the motherlode" or something?

Sorry, I didn't feel like he really spelled out a takeaway means of immediately understanding and applying this

[–] [email protected] 5 points 1 year ago (2 children)

The key is not letting your losses affect your bet amount. With the gain being only 80% instead of 100%, betting your bank means 1 win and 1 loss leaves you with less than you started. Making your bet amount fixed between flips means 1:1 will instead give you a net gain. The Kelly Criterion says there is an optimal proportion of bank you can bet that will maximize this gain over many flips

[–] [email protected] 1 points 1 year ago (1 children)

Is there a metaphysical or like everyday life kind of application to this, everybody seems to be talking about Gambling or like using that metaphor at the very least. I don't gamble (in name if not in deed) but I sense there's a takeaway I can sort of apply to life buried in here. Any thoughts?

[–] [email protected] 1 points 1 year ago

My takeaways would be:

  1. Never trust averages on their face
  2. Being consistent gives you an advantage
  3. Always be looking to reevaluate your situation and maximize what you can get out of it