Sunday, May 30, 2010

Gambling Systems (Extra Soapbox)

This week on the Just Skeptics podcast we were joined by Rick Owen, who talked at great length about common fallacies encountered whilst gambling. He was kind enough to write this accompanying piece for us:

On my guest slot on episode 2 of the Just Skeptics podcast I talk about gambling superstitions and scam systems. Without repeating the podcast spot (you'll have to listen to it), I thought I would expand on a couple of points and include some weblinks.

You can see the free roulette system here. In the podcast I talk about the Martingale system, wherein your stake is doubled after each loss (on 1 to 1 odds like a coin-toss). The problem is that exponential growth gets very big very quickly. If you have infinite money you should be okay. The system on the website is actually a split Martingale system, or Labouchère system : a more gradual increase in stakes, but still doomed. These systems are especially risky in real casinos where each table has a minimum and maximum bet, so you will quickly run up against the table maximum and your system will crash.

It is possible to use physics, maths and a small computer to beat roulette, as in the book by Thomas A. Bass, The Newtonian Casino. This must be the iphone app I would most like to see.

The gamblers fallacy is explained and debunked with a brilliant animated graphic on Wikipedia. But if you're still hopeful of fabulous riches, maybe you should try a "banned" lottery system? No don't, really. Look but don't touch. Having said that, there is a strategy for lottery based on the simple idea that the worst thing that could happen in a lottery is for your 6 numbers to come up, and you go out to buy a yacht and a lake of Cristal, only to discover that you are sharing the jackpot with several other people and you're not even a millionaire. So you must choose numbers which no-one else would choose. That means no birthdays, house numbers, or any system you can think of. You must choose at random - maybe just the Lucky Dip option on the ticket, if you trust it. It doesn't help you win more often, but gives you the best chance of keeping it all yourself if you do.

A great example of how intuition fails us with probabilities is the Monty Hall problem. Super-intelligent lady Marilyn vos Savant caused controversy in 1990 when she posed it in her magazine column. And trans-humanist Eliezer Yudkowsky kindly explains Bayes' Theorem to us. Some people think that we should change maths education to equip everyone with a better understanding of probability, such as mathematician and magician Arthur Benjamin on his concise TED talk.

He makes a good case, but can education overcome intuition? Even knowing the solution to the Monty Hall problem often doesn't help to explain why it should be so. And I had to check the internet to work out whether the end of Deal Or No Deal (which Charlie Brooker described as "a gameshow based on the Copenhagen interpretation of quantum mechanics")  is an example of the Monty Hall problem or not. (It's not.)

When I prepared the podcast, I wasn't even aware of the new copycat format gameshow with Chris Tarrant, which replaces numerology with, er, colourology: The Colour of Money. I can do no better than Harry Hill for a comprehensive take-down of this.

Thanks to Alex, Gavin and Janis for letting me have the soap box for episode 2!

- Rick Owen

Rick Owen is a Manchester-based IT project manager with a physics degree and an interest in skepticism. He is a member of the Greater Manchester Skeptics board and does not have a gambling problem. You can follow him on twitter @Rick_Owen

Download Episode 2 of Just Skeptics (right click then save as)

1 comment:

  1. People's lack of grasp of numbers and probability and love for superstition always trips them up in the gambling world.

    I know only too well because I used to make a decent living out of gambling. I would only gamble when I knew I had the mathematical edge over the house. Without that edge I wouldn't dare to bother. I recently went to a casino in Manchester with friends, and didn't spend so much as a penny. There was nothing in it for me. I might have a good run, I might have a bad run, but the house always had the edge.

    I recommend anyone and everyone read a book by "John Allen Paulos" called "Innumeracy: Mathematical Illiteracy and Its Consequences"