It has been said that if a counter plays pure kelly, then compared to a fixed bettor who never resizes unit, N0 is multiplied by a factor of 9. This makes me reluctant to resize the unit as BR fluctuates.
In the past you have recommended not resizing unit unless 50% of BR has been depleted. In your estimation, how would N0 be effected by such a re-sizing policy?
> It has been said that if a counter plays pure kelly,
> then compared to a fixed bettor who never resizes
> unit, N0 is multiplied by a factor of 9. This makes me
> reluctant to resize the unit as BR fluctuates.
> In the past you have recommended not resizing unit
> unless 50% of BR has been depleted. In your
> estimation, how would N0 be effected by such a
> re-sizing policy?
Does the N0 factor of 9 for a kelly bettor (compared to a fixed bettor) only apply for fully kelly or is it applicable for any fraction of kelly?
On a separate note, do you think expenses for team play should be paid in direct proportion to share of the win?
For example, if investors get 60% and players 40%, should each side be responsible for paying that % of team expenses?
I was reading Axelrod's book, and he mentions one bank where if the team won money, then for that trip the expenses would be paid out of the winnings. OTOH, if they lost for the trip, then the investors would eat the expenses. Thoughts?
Thanks,
MJ
> Does the N0 factor of 9 for a kelly bettor (compared
> to a fixed bettor) only apply for fully kelly or is it
> applicable for any fraction of kelly?
Any fraction, if you remain at that same fraction. Eveything is proportional.
> On a separate note, do you think expenses for team
> play should be paid in direct proportion to share of
> the win?
No.
> For example, if investors get 60% and players 40%,
> should each side be responsible for paying that % of
> team expenses?
Never did it that way. Investors supply the money. They bear the costs of running the "business." Players are "workers"; as such, they don't pay expenses.
> I was reading Axelrod's book, and he mentions one bank
> where if the team won money, then for that trip the
> expenses would be paid out of the winnings. OTOH, if
> they lost for the trip, then the investors would eat
> the expenses. Thoughts?
Terrible idea. Would never do it that way.
Don
> Never did it that way. Investors supply the money.
> They bear the costs of running the
> "business." Players are "workers";
> as such, they don't pay expenses.
Some advocate that the expenses should just be split, 50-50 between players and investors.
My confusion is how one should keep the books. Suppose expenses are split 60-40 between investors and players while earnings are split 55-45 between investors and players, respectively.
At the end of each month, regardless of how the expenses are divided, the expenses for the business obviously have to be paid, even if the overall Br is down. I'm not clear how one takes that into consideration once target is hit.
If for a 30k Br (which the target is 30k-gross), the winnings and expenses for each month proceed in the following manner, then given the aforementioned splits, how should the money be carved out once the target is reached?
I realize this may seem like a silly question, but I would appreciate an answer.
Month 1
Loss - 4k
Expenses - 500
Month 2
Loss - 2k
Expenses - 500
Month 3
Win - 10k
Expenses - 1000
Month 4
Win 4k
Expenses - 500
Month 5
Loss - 1k
Expenses - 1000
Month 6
Win - 10k
Expenses - 500
Month 7
Win - 3k
Expenses - 500
Month 8- Win 10k
Expenses - 1000
MJ
> It has been said that if a counter plays pure kelly,
> then compared to a fixed bettor who never resizes
> unit, N0 is multiplied by a factor of 9. This makes me
> reluctant to resize the unit as BR fluctuates.
It ought to. It just isn't practical.
> In the past you have recommended not resizing unit
> unless 50% of BR has been depleted. In your
> estimation, how would N0 be effected by such a
> re-sizing policy?
I don't know; it's a good question. Let me think about it, and I'll try to get back to you. One of the problems is, as you win back money, when do you restore to full stakes? I've always advocated not waiting till you get back to 100%. My reasoning is: On the way down from 100% to 75%, you don't reduce stakes at 75%, so, on the way up, playing for half-stakes, if you climb back to 75%, why should you keep playing at the half-stakes level? After all, the cards don't know if you're on the way up or on the way down! :-)
So, before your question can be answered, mine has to be answered.
Don
> I don't know; it's a good question. Let me think about
> it, and I'll try to get back to you. One of the
> problems is, as you win back money, when do you
> restore to full stakes? I've always advocated not
> waiting till you get back to 100%. My reasoning is: On
> the way down from 100% to 75%, you don't reduce stakes
> at 75%, so, on the way up, playing for half-stakes, if
> you climb back to 75%, why should you keep playing at
> the half-stakes level? After all, the cards don't know
> if you're on the way up or on the way down! :-)
> So, before your question can be answered, mine has to
> be answered.
Hmmmm...on the way up increase full-stakes at the 75% level. Also, if there is some sort of esoteric formula that is out there to figure this out, please note it.
I will assume your answer to this question applies if there is a 50% flux in either direction, that is to say when the Br decreases by 50% or increases by 50%.
Thanks,
MJ
MJ,
There are more subtle ways to resize than simply changing your basic betting unit.
You have to remember, your Equivalent Kelly Bankroll (EKB) is a function of your whole spread, not just your betting unit. Provided you have access to a simulator or pre-calculated betting tables (or software that generates them), you may find that you can tweak things up or down by changing your spread.
For example to reduce EKB without changing $B, you may lower from 1-8 to 1-6 and wong a little more agressively. Conversely you may increase EKB by playing two hands in positive EV counts. In this way you can create maybe three or four different betting spreads for each unit bet, but try to ensure that N0 is similar for all of them.
By the way, N0 has a different meaning for Kelly players than fixed bettors. A fixed bettor should *expect* to double the bankroll after N0 hands.
The formula for Kelly players is more complicated, and is
t = N0 / (k - k*k/2) .
So if you put k=1/3, that is Bankroll = 3 * EKB, the factor of 9 comes from the denominator.
Brett.
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