September 11, 2009
The Math of Gambling
FIVE years ago, Londoner Ashley Revell sold his house, all his possessions and cashed in his life savings. It raised £76,840. He flew to Las Vegas, headed to the roulette table and put it all on red.
The wheel was spun. The crowd held its breath as the ball slowed, bounced four or five times, and finally settled on number seven. Red seven.
Revell's bet was a straight gamble: double or nothing. But when Edward Thorp, a mathematics student at the Massachussetts Institute of Technology, went to the same casino some 40 years previously, he knew pretty well where the ball was going to land. He walked away with a profit, took it to the racecourse, the basketball court and the stock market, and became a multimillionaire. He wasn't on a lucky streak, he was using his knowledge of mathematics to understand, and beat, the odds.
No one can predict the future, but the powers of probability can help. Armed with this knowledge, a high-school mathematics education and £50, I headed off to find out how Thorp, and others like him, have used mathematics to beat the system. Just how much money could probability make me?
When Thorp stood at the roulette wheel in the summer of 1961 there was no need for nerves - he was armed with the first "wearable" computer, one that could predict the outcome of the spin. Once the ball was in play, Thorp fed the computer information about the speed and position of the ball and the wheel using a microswitch inside his shoe. "It would make a forecast about a probable result, and I'd bet on neighbouring numbers," he says.
Thorp's device would now be illegal in a casino, and in any case getting a computer to do the work wasn't exactly what I had in mind. However, there is a simple and sure-fire way to win at the roulette table - as long as you have deep pockets and a faith in probability theory.
Posted by Robin Varghese at 05:09 PM | Permalink
Comments
You folks are normally pretty unhoodwinkable, so I'm not sure if you actually read this article or not, but the math is terrible, and the writer actually misdescribes several fundamental details re:roulette tables. Amir Aczel's fantastic 'Chance' is a much better survey of these same issues, without making massive mistakes such as ignoring the basic principle of Gambler's ruin!
Posted by: Martin | Sep 12, 2009 2:21:53 PM
As for the wearable computer, this sounds suspiciously like the events described in Thomas Bass' "The Eudaemonic Pie," which took place a few years later, I believe.
Posted by: David Jensen | Sep 12, 2009 9:44:54 PM
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