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Thread: Geoff Hall: A,7 vs 9

  1. #21
    Don Schlesinger
    Guest

    Don Schlesinger: Just change the number of hands

    A suggestion: this bet involves an intelligent person and a moron. I don't think 200 hands should be sacrosanct. If this person believes standing is superior to hitting, then surely, he'd like the experiment to display the truth, right?

    After all, he wouldn't want to play just 10 hands, and risk being proven wrong by a fluke occurrence, would he?

    I guess he won't trust a book or computer sim, so we're going to have to deal hands. But, for $15,000, why stop at 200? Who's in a rush? Let's get it right. So, let's deal 500 or 600 hands ... or more. What's the difference? If the moron thinks he's got the right side of things, he should want MORE hands, not fewer, right?

    Just a suggestion.

    Don

  2. #22
    Karel
    Guest

    Karel: Of course...


    > "Reasonable wealth" meaning not so
    > much, right?

    Yes, meaning not so much. The calculation was based on total wealth, including everything (income, etc.) of only $200,000. This is related to my economics paper about risk aversion. I am very modest there since I try to make the point as strong as possible.

    > What does "$p=30$" mean???

    This is the risk aversion. $p=30$ means 1/30 Kelly, based on total wealth. Not really too conservative.

    > Send him to me! I'll gladly accept the
    > wager, at even money, with 4 to 1 odds in my
    > favor, for $15,000.

    Of course, the "reasonable" wealth assumption is not valid in this case :-)

    Anyway, I mentioned the result also as proportion of total wealth. Would you like to participate in this bet, if the bet size was 5% of all your wealth, take it or leave it?

    Regards,

    Karel

  3. #23
    Geoff Hall
    Guest

    Geoff Hall: Re: Just change the number of hands

    > A suggestion: this bet involves an
    > intelligent person and a moron. I don't
    > think 200 hands should be sacrosanct. If
    > this person believes standing is superior to
    > hitting, then surely, he'd like the
    > experiment to display the truth, right?

    > After all, he wouldn't want to play just 10
    > hands, and risk being proven wrong by a
    > fluke occurrence, would he?

    > I guess he won't trust a book or computer
    > sim, so we're going to have to deal hands.
    > But, for $15,000, why stop at 200? Who's in
    > a rush? Let's get it right. So, let's deal
    > 500 or 600 hands ... or more. What's the
    > difference? If the moron thinks he's got the
    > right side of things, he should want MORE
    > hands, not fewer, right?

    > Just a suggestion.

    > Don

    Good point although generally when dealing with this type of person they fail to understand any form of logic.
    I noticed that Karel said that 660 hands would give a 95% degree of confidence so I will suggest that my friend tries to persuade this player to deal 700 hands using your 'logic' to him.
    I will post the outcome if ever the bet takes place.
    Thanks to all those who posted their analysis and suggestions.

    Best regards

    Geoff

  4. #24
    Don Schlesinger
    Guest

    Don Schlesinger: Re: Of course...

    > Anyway, I mentioned the result also as
    > proportion of total wealth. Would you like
    > to participate in this bet, if the bet size
    > was 5% of all your wealth, take it or leave
    > it?

    Interesting question. I'd be very tempted to accept (but my wife would probably kill me! :-)). I'll have to think about it. Good question!

    Don


  5. #25
    Don Schlesinger
    Guest

    Don Schlesinger: Wife shocked me! :-)

    Well, I'm very proud of my wife! She thought about it long and hard. Wasn't a clearcut choice at all.
    I was quite shocked, to tell the truth. Finally, she did admit, "That's a lot of money," but she didn't say it as if it would be unthinkable to make the wager.

    As for me, after losing about 20-25% of my entire net worth in the stock market these past three years, I think another 5% wouldn't kill me.

    I'd make the bet, Karel.

    Now, can you show me the math (which I probably won't understand) as to why it's wrong to do so, please.

    Don

  6. #26
    Susan
    Guest

    Susan: Re: Just change the number of hands

    ...
    > persuade this player to deal 700 hands using
    > your 'logic' to him.
    > I will post the outcome if ever the bet
    > takes place.
    > Thanks to all those who posted their
    > analysis and suggestions.

    > Best regards

    > Geoff

    Go for 500 or even better 1000 hands. He may think you are trying to trick him into something unusual with 700 hands.

  7. #27
    Karel
    Guest

    Karel: It's definitely not wrong!


    > Well, I'm very proud of my wife! She thought
    > about it long and hard. Wasn't a clearcut
    > choice at all.
    > I was quite shocked, to tell the truth.
    > Finally, she did admit, "That's a lot
    > of mooney," but she didn't say it as if
    > it would be unthinkable to make the wager.

    It is just about risk aversion. Accepting this bet says that you risk aversion is not higher than 30, or 1/30 Kelly.

    However, games like that get a little misleading. Behavior finance says that people do not exactly behave according to utility functions. The risk aversion tends to be lower for larger bets. The reason could be that one large bets gets resolved, while with many small bets one has to "suffer" through, etc. Even though the total result is the same, it is better to "get it fast".

    I will post the forumulas later tonight on the Math page.

    Karel

    > As for me, after losing about 20-25% of my
    > entire net worth in the stock market these
    > past three years, I think another 5%
    > wouldn't kill me.

    > I'd make the bet, Karel.

    > Now, can you show me the math (which I
    > probably won't understand) as to why it's
    > wrong to do so, please.

    > Don

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