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Martingale – Final Thoughts

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After sharing my Martingale story over the last couple of posts I’ve got a few more things to say on this subject before putting it to rest.

James from the excellent blog BetfairProTrader.co.uk dropped by. I’ve actually bought a couple of books on his recommendation. I’m probably not the only one so he should think about asking Amazon for some commission! Anyway he made a number of points that I agree during part 1:

The Martingale (or Fibonacci or whatever) always annoys me. It is still doing the rounds on YouTube as the “only way to win at roulette”.

And the worst thing is that it will only ever win back your first bet i.e. if you bet first with £1 and doubled up thereafter to £64, £128 or whatever then a winning Martingale will only see you up by £1. All downside with no upside.

Then there are the crackpots who use the Fibonacci series to tell them how much to bet. They may as well use rune stones or crystal balls.

There are so many lazy people in betting who think that a simple mechanical system will make them rich. Even a degree, knowledge of maths and stats, the ability to program a computer and knowledge of sports and markets is no guarantee of achieving millionaire status. Being a dummkopf is a serious handicap.

Oh well, at least in a zero sum game having dunces on the other side of your trade helps pay the bills. We can’t complain.

JayBee – http://www.betfairprotrader.co.uk

If you were betting either Red or Black on roulette, and doubling up after each loss, when you got a win you would indeed be only up your original stake.

Speaking of Red or Black, this reminds me of another story I heard. Another former work colleague mentioned how he was in a casino once, at a roulette table, and Black came up 12 times consecutively. Towards the end of this streak, he was telling how people at the table couldn’t believe it and were saying things like “Black can’t come up again!” and “it simply has to be Red this time”.

“Uh oh. These guys are on to me. I better come up with Red this time to keep things honest”

Apparently people were placing more than their normal staking amounts on Red. And each Black was greeted with louder and louder reactions, with disbelief being the primary emotion.

So here’s another example of gambler’s fallacy, or some may just call it stupidity. These are the sort of people you would want to pay poker with or meet on the betting exchange as James correctly points out. This is the dumb money that makes betting the under on the Lakers or Cowboys most years the right call.

Betting when done properly is probably quite boring to most people: usually only betting a very small percentage of your betting bank on each bet. That’s not going to get you rich quick. In a generally impatient society you can see the attraction of a system where every winning bet leads to an all-time new high for your betting bank.

Cassini over at Green All Over (another excellent blog) pointed out that the star-of-the-Martingale-story; David, was incorrect in stating that roulette has the “best” odds of the casino games. (Best being the odds that are closest to the true value). It’s a good idea to know which games cause you to lose the slowest should you find yourself there.

I myself have only ever been inside a casino twice, played a little bit of blackjack and roulette, and I’m unfamiliar with some of the other games on offer. I’ve never played craps or baccarat, and I’ve never even played a slot machine!

Soccer

The Conclusion of A Short Story on Martingale

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Following on from this post.

So David’s football Martingale system wasn’t exactly a resounding success, he had lost around £30,000. So it was back to the drawing board…and the answer was clear: try the same system on roulette!! No more looking down every league table in the world looking for who had the fewest draws. Plus you can play roulette constantly at all hours of the day!

David signed up online to a famous bookmaker, made a deposit and got some welcome bonus. Then started with his £1 bet on a third of the board, so numbers 1-12 for example. If that bet lost he would double up and bet £2, and keep doubling up his stake until he got a winner, just like he did with the draws.

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Within an half an hour of playing for the first time he was up around £3,000. His wife came into the room where he was playing on his laptop and he told her that he was up £3,000 and that there must be a problem with the website, so he would have to continue playing all night. Honestly. As he had won so much money so quickly he actually thought that there was a problem with the website that he needed to quickly exploit with his fool-proof system!

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Sorry, another facepalm meme.

His wife returned half an hour later to find out that he had lost all that money. “You idiot”, was her reply before she convinced him to log off before any real damage could be done. Which is some pretty solid advice. Unfortunately she couldn’t keep an eye on him at all times.

Some weeks later at the office I passed him on the stairs. I was walking up and he was walking down.

“Alright David” I said.

No reply.

Not even eye contact. He didn’t even blink and looked really flushed. With all my powers of intuition I could tell he was pissed off, big time. At the top of the stairs I went into his office that he shared with a couple of chaps. So I asked “Hey, what’s up with David he looks a bit…”

I was cut off by this almighty scream from the toilets downstairs:

“FUCKKKKKKEN BASSSSSSSTTTTTTTTTARDDDDDDDDDDDD!!!!”

David had lost £11,000 on online roulette in a few minutes during his lunch hour, and had just had a momentary breakdown in a cubicle. It was the final time he tried his Martingale system.

I think it was around £36,000 of debt that David ended up on his credit card as a resulting of his Martingale betting. He was earning a lot of money so it “only” took him a few months to pay it off. As I said in the first post he knew that you would hit a losing run that would leave you heavily in the red, and yes I did warn him about it. But he also said that his problem with the football betting was not having the balls during the losing run to put the next bet on! But the next bet would have been for him to place £16,000 on a draw, losing which would lead to doubling the total loss to £32,000.

Basically he didn’t have a full grasp on betting 101 subjects such as probability, variance, ”the long run” and you know, having an edge. I remember him saying that with roulette you had the best odds of all the games in the casino, ie the odds were the closest to the true odds of all their games. The way you should look at it is that the casino always has the edge, so don’t even bother especially with a system like this.

Trivia Question of the Week

Last week I asked:

In football/soccer/kickball who was the last team to win the English FA cup wearing striped shirts?

Just to be clear, this was the shirt they were wearing in the final, which may not necessarily be their usual home strip.

If you got this one unaided that you have my respect; in was Coventry City all the way back in 1987!

New question, as Wimbledon’s on lets have a Tennis one, much easier:

During the open era who are the only 2 ladies to win the singles calendar Grand Slam (all four major tournaments in the same calendar year).

Soccer

A Short Story on Martingale

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Many years ago in a city far away, your beloved writer had this job and had this manager. For the story I’m about to tell, I’m sure this manager would wish to remain anonymous…

So David had this betting system. If you’re like me, then you will immediately begin rolling your eyes around upon hearing the phrase “betting system”. His system was a Martingale system.

He would start by placing a £1 bet with odds of over 2.0 (evens). If the bet lost then he would double up, so the next bet would be £2 on something, again, with odds of over 2.0. He would double up until he got a win, and then he would start all over.

Sounds great…in theory. Eventually you’re going to get a win which will cover all your preceding loses to leave you in profit. The problem was that you are going to hit a run which will blow your bank, leaving thousands of pounds worth of debt on your credit card. And the funny thing was, David actually knew this! He knew the risks involved with this betting system, but it didn’t stop him.

The bets he was placing were all on backing the draw in football (soccer for my friends in US). Now he wasn’t exactly analysing as much data as he could get his hands on, to calculate the percentage chance that a draw was likely to take place between 2 teams. And then see if he had an edge over the bookie’s odds. No, to hell with that, that’s far too much hard work. David would just look at the fixtures for the day, FROM AROUND THE WHOLE WORLD(!) and see if there’s was a team playing that was “due a draw”.

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I shit you not. Not only have we got a story about Martingale, we have a story about the gambler’s fallacy too. We’re all about efficiency here at Winners Win.

So Davey boy would look down the league table and check out who had the fewest draws to find out who was “due” a draw, and that prompted each bet.

He told me how he hit that inevitable losing run that lead to him placing £8,000 on 2 mediocre Premier League teams to draw. He was actually in a crowded pub watching this game on TV in an early kickoff, near the stadium of the team that he supports, and he was about to watch his team play later on. He was there with his mates who knew that he had £8,000 on the live game on TV ending up a draw. Word soon got round the pub that our guy was “balls deep”, as the kids would say, on the draw. Just into injury time and the score is 1-1. Things are looking great:

  • That awful, stressful, but totally expected, losing run is about to come to an end.
  • And David is about to be roughly £5,000 in profit, after taking into account all previous loses.
  • And better than that: David is about to earn the respect & envy of a pub full of drunk football fans!

Get a picture of that situation in your head.

Form a clear mental image…

Now imagine how he felt when one of those teams scored a winner with the last kick of the match.

A punch to the gut, or even a sharp, swift kick to the happy sacks would be more pleasurable than that experience. That £8,000 loss adds to a total loss of £16,000. And a crowded pub is there to witness your agony.

MartingaleExcel

He said that after that game had ended he was sat on the floor with his back against the bar, with his head in his hands as strangers would come up to him to pat him on the shoulder to try and comfort him. He didn’t even bother going to watch his own team play that afternoon.

He wasn’t ready to throw the towel in just yet with this system, after enough time had passed for him to get over this he started from scratch betting £1. He didn’t want to carry on with the next bet in this sequence which should have been £16,384.

But it ended with the same results. Eventually he hit a losing streak that required him to be placing a lot more money than what he was comfortable with on one bet. He finished his Martingale system betting on the draws down about £30,000 in total… So he did what any rational individual would do: he tried this system on online roulette.

double-facepalm

To be continued…