Negative CE?

[Stevie Wonder]

I'm not quite understanding the difference between EV and CE. A game I've got simmed right now shows me an EV of ~$100 per hour, 8% RoR, and a CE of $8. The EV after 100 hours of play is $10,000. The CE would be $800. Is the CE a formula that asses the risk versus reward factor, and says the chance of making the $10,000 is only worth the certainty of making $800?

[RS]

I'm not quite understanding the difference between EV and CE. A game I've got simmed right now shows me an EV of ~$100 per hour, 8% RoR, and a CE of $8. The EV after 100 hours of play is $10,000. The CE would be $800. Is the CE a formula that asses the risk versus reward factor, and says the 92% chance of making the $10,000 is only worth the certainty of making $800?

Let's say there's a coin-flip game (exactly 50/50) where the casino paid you 1.02-to-1 (ie: 1% edge) on heads. Surely you have an advantage and playing would be +EV. Let's say you have a $100k bankroll. The casino only allows bets of $50k. As you can see, this game has high risk, if you were to play it. The CE, however, is going to be a negative number, unless you have an extremely high risk tolerance (ROR).

Now let's say someone else with a gigantic bankroll (Bill Gates) would have a positive CE, because his bankroll is so big (and thus, the game is not as risky).



Try doing this -- in CVCX, lock/freeze the custom bets, then change the ROR figure. Then change the bankroll figure.

[Three]

It seems there might be some confusion. EV doesn't factor in variance. SCORE and N-zero factor in variance as an EV to variance ratio. CE factors in variance by subtracting a relationship between variance, bet size, BR and kelly fraction from EV. This expresses the certainty of BR growth or CE. It is expressed as hourly amount payed to you that would be the equivalent of risking your money playing. IF your CE is $84 then if someone offered you $84/hour to not play it would be better than risking money playing.