A Football Traders Path had a post today on statistics, and yes, they can often be misleading, but is SoccerDude right in saying
I was reminded of another well-known "fact": that 95% of all gamblers lose money.I'm not sure where that number actually comes from, (I've seen 90%) and the term 'gambler' is anyway problematic. The definition of a gambler is "a person who wagers money on the outcome of games or sporting events". OK, so I'm a gambler, but I don't like that term at all. It has all kinds of negative connotations, and doesn't differentiate between the degenerate gambler for whom a trip to the bookies is part of a daily routine, and who has no clue about value or probabilities, and the sophisticated 'advantage gambler' who selectively bets from his home only when there is value. Yes, I "take a risk in the hope of gaining an advantage or a benefit" but the word doesn't seem appropriate if it used to describe someone who is consistently profitable. I would actually suggest that 95% is too low a number. I know from personal experience that bookmakers close profitable accounts, so long term winners at the bookies would be very few and far between. SoccerDude writes:
Alright you get the point. I'm not saying this "95% losers" notion is false and I'm not saying it's true - I've never seen any definitive proof either way. But what purpose does it serve knowing it? Does it help you as a gambler/trader? I personally know a lot more winners in the gambling world than I know losers.That last sentence there, I seriously question. Far more likely that the author knows a lot more people who claim to be winners than admit to being losers. As as been mentioned before, human nature is to have selective memory when it comes to these things. If the figure of 1 in 20 gamblers are profitable is true, then the likelihood of knowing more winners than losers is rather a long shot. If you have just three friends, the probability of that statement being true is pretty small.
SoccerDude continues with:
If you have a negative P&L or you have lost money continually over the last few years, well at this precise moment in time that doesn't really matter.... We are all losers at a particular snapshot in time, just as we are all winners.Yes, we all have winning bets, and we all have losing bets, but whether we are winners or losers is a long-term / lifetime thing, not something based on a brief period of time, and the past does really matter. You can't just reset your P&L and claim to be a winner and write off previous losses as if they had never occurred. Profitable gambling is not easy. You not only have to find value, but beat commission and expenses too. I doubt that 1 in 20 can do that.
Consider - ~500 Super Premium Charge payers on Betfair, ~3.8 million users...
Betfair Premium Charge payers - less than 0.5%...
Where do these 1 in 20 winners place their bets?
cassini, where can one watch live NBA on uk tv? cheers!
ReplyDeleteHmm, a little bit of cherry-picking to make your point? Surely not.
ReplyDeleteThe last part of my post that you quote does conveniently leave out the important next sentence. I said what I said about the past - not to say that you can just dismiss it all with a majestic sweep of your hand, but rather to point out that it does not necessarily mean things will continue to be like that in the future.
A leopard doesn't change its spots, it is said - but I know from my own experience that I have changed the course and the methodology of my betting over time. So change is indeed possible.
That's the point I was making. Not that your lifetime P&L is unimportant.
Cheers
Eddie.
As I conveniently inferred in my post a few minutes ago, previous lifetime losses can actually be of benefit if/when you do finally crack it not only as a commission generated buffer as I mentioned but also because you will (hopefully) have previously had a lot of bad habits that you’ve learnt to avoid.
ReplyDeleteIf I were a betting man I’d say that overall winners, i.e net lifetime profit >= £0.01 was significantly higher than 5%. I’d also agree with the both of you, firstly with Cassini in that net profit has to be framed in a long-term context (not sure that lifetime is suitable in all cases). Also with Eddie in that people and their habits can and do change. There are probably very, very few people who win their first bet and go on to never drop below that starting figure.