Thinking About the Game
Betting the Big Bucks
Sometimes you need to bet it all to win anything
by Basil Nestor
A few years ago an Englishman named Ashley Revell sold everything he owned, converted it to cash, traveled to Las Vegas, and bet the whole amount on one spin of roulette. Pretty gutsy. Ashley even sold his clothes. He was wearing a rented tuxedo when he pushed the chips forward. The wager was $135,300 on red. The dealer spun the ball. It slanted down into the wheel, bounced around a bit, and finally settled on the number 7… RED! Ashley was a big winner. Nice. But at the time, a lot of people criticized him for making a supposedly stupid bet. Ashley’s father was quoted as saying “’I told him he was a naughty boy, he was a bad boy, he shouldn’t do it. He should work like all other kids do.” Various pundits also clucked their tongues judiciously. Steve Dixon, an anchor for Sky News, bluntly proclaimed, “What a stupid thing to do.” CNN correspondent Anderson Cooper ended an interview with Ashley by saying, “I hope you at least put some of it in the bank.”
In other words, the general consensus was that Ashley should be grateful for his dumb luck, but the bet was stupid, stupid, stupid.
Well, guess what. Mathematically and strategically speaking, Ashley’s bet was a very smart gamble, and it illustrates a fundamental fact about game theory that is often misunderstood by many casual players (including some network anchors). It goes like this…
There are times when a big bet is absolutely optimal. In these situations, betting anything less than the max actually lowers your long-term probability of winning.
Note that this rule does not mean you necessarily should sell everything you own and bet it on roulette. But it does mean that betting less than the max is sometimes a sure-fire way to be a long-term loser. And this rule applies to almost every gambling game.
The Economics of Game Theory
Many people incorrectly believe that bigger bets automatically increase the probability of bigger net losses, and smaller bets give you a better chance of squeezing out a net win. In fact, this is often not the case. Rather, optimal gambling strategies are based on the premise that you bet more when you have an advantage and less when you have a disadvantage.
So when you have an advantage, the more you bet, the more you win over time. The less you bet, the more likely you are to be a net loser. Read it again. Not exactly intuitive, is it? Nevertheless, it is true.
When you are at a disadvantage, then the familiar rule kicks in. Bigger bets are bad, and smaller bets save your bankroll.
A Double Down in Blackjack
A double down in blackjack is a classic example of this rule. (If you’re not familiar with blackjack, a double down is essentially an opportunity to double your base bet after the first two cards are dealt. Your hand receives one additional card, and that is all.)
Doubling as per optimal strategy is an absolute requirement for long-term profit in blackjack. If you don’t double down on the correct hands, then it is practically impossible to be a net winner. The reason is obvious. Some blackjack hands (such as combinations that total 10 or 11) are frequent winners. If you don’t earn extra money on those good hands, then the bad hands will soon bankrupt you.
Unfortunately, casinos don’t allow you to triple down, quadruple down, and so forth. You could earn a nice living playing blackjack if the rules permitted bigger bets in those situations.
A Raise in Poker
A similar condition occurs when you raise in poker. Usually, a player raises when he has a good hand, hoping that other players will contribute to the pot. But a raise also has the effect of causing some opponents to fold. So if you raise, and an opponent drops out, this increases your chances of winning.
Indeed, there are many situations in poker where a call will cost you money, a fold will save you money, but a raise will earn you money by knocking opponents out.
If you watch poker on television, you surely have seen players who go all in, betting everything they have on one hand. Sometimes an all-in player is hoping for a call, but in other cases he is hoping that an opponent will fold. In those situations a big bet is more likely to be profitable while a small bet would tend to be a loser.
Taking Odds in Craps and other Max Bets
Craps has a bet called “odds” which has 0% edge for the casino. Technically it doesn’t matter how much you bet in odds because neither side has an edge, but if you shift dollars away from other disadvantageous bets on the table to increase an odds bet, then the overall effect will increase your probability of being a net winner.
Similarly, there are many slot and video poker games that pay a premium when a player wagers max credits. In some of these situations a max bet is a good deal. Examples include video poker games that pay 99% or better when played with max credits, and any game with a large progressive jackpot (let’s say $100,000 or more). For instance, it is foolish to bet two credits to win $10,000 when you can bet three credits to win $20 million.
Ashley’s Special Bet
Okay, but what made Ashley Revell’s bet such a good deal? He didn’t have an advantage at the wheel. Nobody was going to fold to him. And he wasn’t getting a premium for a max bet. Or was he?
Ashley began his quest as a nearly anonymous player, but by the time he pushed $135,300 onto red, he was the star of a TV show that was broadcasting his outlandish wager, and he had become an international personality. The value of the publicity he got far exceeded the amount he bet. Win or lose, he was poised to turn his notoriety into tangible income.
So in Ashley’s case, there was no way for him to finish as a net loser, as long as he made a big bet. But a small bet would not have had the same positive effect. This is an important lesson to remember if you are ever tempted to liquidate everything and risk it all in one game; just be sure you get a win-win deal like Ashley did. Of course, we’ll never know exactly what would have happened if he had lost, but it is unlikely he would have been poor for very long. He has since invested his winnings in an online poker site (which presumably is generating income for him to this day).
In the end, his big bet was a very smart bet. Granted, it was outrageous by most standards, but you don’t need to sell everything to use Ashley’s strategy. Simply look for a clear advantage, and then double down, raise, bet max credits, or otherwise follow optimal tactics to whatever degree that your bankroll will comfortably allow.
Enjoy the game!
Basil Nestor is author of The Smarter Bet Guide to Blackjack, Playboy Complete Guide to Casino Gambling, and other comprehensive gambling guides. Got a question? Visit SmarterBet.com and drop him a line.