Take the 2-minute tour ×
Mathematics Stack Exchange is a question and answer site for people studying math at any level and professionals in related fields. It's 100% free, no registration required.

I'm sure this is a silly and banal question next to all the crazy string theory and lambda calculus questions on this site. Perhaps it's a nice, easy, refreshing break. Anyway, on to the casino...

SatoshiDice is a betting website. You expose your money to risk and gamble for a reward.

I know the house maintains an edge, but I'm just having trouble reasoning through it. Would someone mind explaining it to me with a simple example?

For example, say I wager 1 bitcoin on the "lessthan 48000" bracket. I have a 73% chance of winning, but the payout is only "1.323x", and the house takes a 3% rake. So, 73 out of 100 times playing I'll win slightly over 1%, and 27/100 times I'll lose everything, so... well, here's where my brain pretty much shuts down. Maybe it's just time to get some sleep. :)

I asked this question here instead of http://bitcoin.stackexchange.com because it seems more about math than bitcoin.

share|improve this question
add comment

1 Answer

the table says that your chance to win is 73.2422 % and then you get 1.323 times of your bet. then you win about 32,3% ($(1.323-1)*100$). Because of $0.732422*1.323 = 0.968994306$ the casino wins about $1-0.968994306=0,031005694$ that is about 3.1%

share|improve this answer
1  
In particular, OP should notice that the house 3% rake is built into the payoff odds, and not excised separately. –  MJD Jul 1 '12 at 7:49
add comment

Your Answer

 
discard

By posting your answer, you agree to the privacy policy and terms of service.

Not the answer you're looking for? Browse other questions tagged or ask your own question.