When The Odds Are With You — You Are Playing. Otherwise, You Are Gambling.
A young chap taught me that.
The key message for this story is to avoid gambling, not to encourage it.
I was out for lunch at a coffee shop packed with people. I had no choice but to ask a young man if he is willing to share the table. I was glad he said yes. Of course, I said thank you.
As we were eating, we could hear the conversation that is going on at the other table. We are not eavesdropping. These uncles spoke so loudly that any diner at the furthest end of the coffeeshop can hear them.
They were talking about going to the casino to make a killing.
They got more excited as they speak, and their volume increased exponentially. I heard roulette, blackjack, and others.
The young man who shared the table with me shook his head in disbelief all this while. It was blatantly obvious he disapproved of their follies.
I wanted to know what he was thinking, so I asked what his thoughts were based on what we heard.
He said something impressive.
“When you have the odds with you, you are a player. When you bet on blind faith, you are a gambler.”
What a deep thinker. What a marvel.
I asked what he meant because I knew I could learn something from him.
Me: “What do you mean?”
Young Man: “We have to understand what our odds are and only make bets when we know the odds are in our favor.”
Me: “How to do that?”
Young Man: “They said roulette. It is hard to win many bets in the game of roulette. You see, in the game of roulette, you can bet red or black, odd or even, am I right?”
Me: “Yes, you are.”
Young Man: “But the odds are not 50/50. Do you recall 0 and 00? They are green.”
Me: “OH YES, you are right!”
That young man taught me a practical lesson on probability.
In roulette, there are 38 pockets with running numbers from 1–36, plus 0 and 00. Odd numbers are in black, and even numbers are in red.
If we bet on red, then our probability of winning is not 50%. It is 47.4%. That’s because both black and green pockets are non-red. When we bet red, the dealer is automatically assigned the other 2 colors. Their odds against us are 52.6% (100% — 47.4%).
I was doing the math at the back of my head while he speaks. This guy understands probability.
He continued saying that having a 52.6% odds against does not mean that we lose all the time. It just means that over a long string of multiple bets, the casino will always be able to win more than we do.
That means their odds of winning each bet against us increase all the time, each time we place a bet.
I learned a lot from him.
I have a simple takeaway from this.
Do not continue to play when we are encountering a losing steak. The system is designed against us. 47.6% win rate cannot beat 52.4% at any time, over time.
Stay conscious of the probability game. Be aware of our emotions. Our desperation to recoup our losses results in more losses.
Maybe the best advice is to leave the table when we are done.
It is better to cut our losses than to magnify them.
Remember. Be a player, not a gambler. It makes a world of difference. Do not gamble in blind faith!
Aldric
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As a content contributor, I write my observations from daily life and my business exposure.
Because our life experience is the bedrock of our unique perspectives.