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My Secret To Win At Gambling Finally Revealed

One of the difficulties that world-famous public personalities such as myself face is that people think we have the answer for every question. That isn’t true.

It’s only mostly true.

Because I deal with numbers, about twice a week I receive emails from people the world over asking me to sell my Secrets To Win At Gambling.

It turns out I do have a system, which, if I thought I could get away with it, I would sell. I’d have to insist on payment up front, though; no refunds. You’ll see why in a moment.

Here is a typical email:

From: Ralph
To: matt@wmbriggs.com
Sent: Thu, May 20, 2010 9:30:16 AM
Subject: Horse-racing (Can you help me win)?

Do you have anything in HORSE-RACING THAT I CAN COME OUT A WINNER?

I have tried many SYSTEMS & METHODS since 1974, In California,Las Vegas,and New York. NONE OF THEM COULD WORK (HOLD WATER) FOR A LONG PERIOD OF TIME.

PLEASE BE MORE CONVINCING OF WHY THE METHOD OF MR BRIGGS WOULD MAKE ME A WINNER MOST OF THE TIME.

SINCERELY YOURS
RALPH

It helps to know that English is not “Ralph’s” first language.

I gave “Ralph” my system for free. And because of my overwhelming love and generosity for all of mankind, I publicly reveal here for the first time:

From: William Briggs <matt@wmbriggs.com>
Subject: Re: Horse-racing (Can you help me win)?
To: Ralph
Sent: 20 Îœy 2010, 22:38

Ralph,

My system is this: take all the money you would have bet and place it in the bank at the best interest rate you can get. Then, at whatever period in the future you care to name, the chances are better that you will have more money than if you had placed bets at the track.

Best of luck,

Briggs

I thought that would be the end of it, but then “Ralph” went and broke my heart when he replied with this:

From: Ralph
To: matt@wmbriggs.com
Sent: Fri, May 21, 2010 5:19:23 AM
Subject: Re: Horse-racing (Can you help me win)?

Dear Mr Briggs,

Thank you for responding to my E’mail. I appreciate your honesty. YOUR HONESTY IS TOO MUCH. I wish I had your response some 30 years ago, when I first started using different strategies, systems. and methods of the so called experts in the horse racing, by paying out hard earned money to all those crooks, who claimed that their SYSTEM was a sure winning method. “MONEY AT THE BANK”…(they were saying.)

The reality is I lost all my money that I took away from my savings in order to try the different systems of handicapping the races, in search to win. NOTHING WORKED.

I had started to realize it on my own THAT NOTHING WORKS. Then I joined GAMBLER’S ANONYMOUS in New York city, where everything was confirmed to me.

I have no money at the bank, and I owe money to financial institutions. This is the only reason I wrote to you for help.

THANK YOU

Ralph

Here’s some more free advice, “Ralph.” I don’t think Gambler’s Anonymous is doing everything they can for you. Either that, or you’ve been negligent in following their advice. They told you that “nothing works”, which is the right answer. Nothing does.

You will be sparing yourself much future grief if you don’t email anybody else offering to pay for gambling systems.

You will always hear of somebody winning big, which might tempt you to return to betting, but remember these two truths: (1) gambling regularly guarantees you will go broke; and (2) most people lie, misremember their betting history, or both. I have yet to talk to somebody who doesn’t say something like, “Sure, I’ve lost a few bets, but overall I’m about even or a little ahead.”

This is nonsense. Everybody who gambles habitually loses, and they are meant to lose. The lone exception is poker. However, you should know that it is more likely you will cheated out of your shorts than you will win.

The only sure-fire way to make consistent money at gambling is to be the bookie. Casinos know this, insurance companies know this, stock exchange owners know this, and that guy at the bar who feeds you the line on the Yankees know this.

Only don’t try and set up as a bookie without first getting permission from the organization that unofficially administers local gambling. They don’t appreciate competition.

27 thoughts on “My Secret To Win At Gambling Finally Revealed Leave a comment

  1. I get the same type of submission, but about designs for perpetual motion machines. The machines of second kind are actually interesting to explain and analyze, but there aren’t many of them submitted. Most are machines of first kind like this one:

    A battery runs an electric motor which turns an air compressor which pumps air into a storage tank which runs an air motor which turns a generator which charges the battery. I reply to the inventor, “Why not remove the air compressor, tank, and air motor? Just connect the motor to the generator.”

    “Because it will stop working” is his answer.

    Some people are forever hopeful.

  2. Unfortunately, for someone to win, someone has to lose. However, after reading your correspondent’s e-mail I am feeling slightly guilty. There are inefficiencies in the various markets (pools) which can be exploited. It gets tougher every year as the betting public becomes more savvy. It requires WORK to find them. Most of the people supplying the base money are too casual in their approach and, in most cases, are unwilling to expend the energy needed to be successful. There are definitely NO quick and easy ways to make money doing this.

    I have never had a negative return for the last 15+ years. Short of sharing my accounting sheets, though, I don’t know how to prove it. (No, don’t even try.) I do admit it’s not enough to let me quit my day job. Back in the 90’s I did take about one year and devoted it to the track. I cleared over $10K but, considering the number of hours I expended, I made around $1.50/hour. I did discover that the middle of the week, when there were mostly only professionals in the market, was the hardest. The bread and butter came on the weekend when we were joined by the likes of Ralph and your e-mailer.

    Note that what I do is possible only at the track and only because there ARE betting inefficiencies. In many ways, it’s similar to holding a short position in the stock market. I completely agree with your assessment of gambling on casino games and lotteries as these have been rigged against the bettor.

    All that said, your advice to your e-mailer is the best advice they can get. If you have to ask how, you’ve already lost.

  3. RE: Powerball

    1. The odds of winning are about the same whether you buy a ticket or not.
    2. If you don’t play, you can’t win.

  4. Speed, if you mean essentially zero chance of winning, then resoundingly a YES but there is that greater than zero chance of huge payout. The bet is definitely a negative bet**. I still toss a $20 at it when the annuity payout exceeds $100M so I can’t say I never gamble.

    **What I mean by a negative bet: my ‘system’ at the track — hardly a secret — is to only take bets where hROI > cost/P(success). hROI is the estimate of the return per unit cost. If hROI < cost / prob then it is a losing proposition in the long run. Of course, long-term success means having good estimators for hROI and P(success). Therein lies the rub. At one time, estimating P(success) was my biggest problem. Nowadays, with the increase in off-track betting, my biggest problem is estimating ROI since the money keeps rolling in while the race is in progress. Takes more than simply jumping in at race time minus 2 minutes mark which worked well in the past.

  5. Dav (22May 2010 at 11:30 am):

    Why you are willing to spend 20 bucks for 20 chances to win $101mm, but not $99mm? And why based on the annuity payout rather some value of the cash payout?

  6. Hmm .. given my definition of hROI, cost in the equations should read unit cost. hROI is the expected payout for a $1 (or 1 whatever) bet compared to the long-term break-even value of the bet.

    Here’s a plot of my P(success) for the place pool. It’s based on approximately 12300 races from Jan of this year to present. The estimator is ‘hPRB’. The plot shows a logistic estimator of P(PL | hPRB). I actually assume hPRB=hPL (the red line). There is a close match between the two which gives me confidence. I atttribute the variation to the logistic propensity toward the ‘S’ shape. All other logistics to date are more ‘S’-like. hPRB is also used in my ROI estimator. I also have to account for my own influence on the pool.

    http://www.dvavra.com/pics/HCP/Estimate-P-PL.jpeg

    Speed,

    No particular reason other than $20 is the most I’m willing to spend; making it (for me) the optimum at increasing my winning chances. The $100M would yield around $12M cash payout assuming a 4:1 annuity which would be a nice retirement gift. FWIW: I really don’t have any idea what the annuity ratio being used is and I’m assuming a 50% income tax. The numbers may be off but I’m throwing the $20 away so, whatever …

  7. The secret to winning at the Horse track is same as the stock market.
    Look for things that are ‘undervalued’ given the potential return rate.
    The ‘favorite’ at the track will always be overvalued by people who like to ‘pick the winner’.
    The ‘long shots’ at the track are also overvalued, by people looking to get rich quick.
    In the middle are some ‘fair performers’ that aren’t good contenders to win, but have very good chances of taking place or show. These tend to undervalued.

  8. Harrywr,

    You’ve got the right idea but stay way from the win pool. It’s what’s called a “weakly efficient” market meaning that there are inefficiencies (over/under values) but the efficiencies are insufficient to overcome the track commission which seems to go up every year.

    For more info, find the excellent papers by Ziemba, Hausch and others. It also wouldn’t hurt to read John Kelly’s paper done in the 50’s (http://www.racing.saratoga.ny.us/kelly.pdf) and Daniel Bernoulli’s in the 1700’s http://www.jstor.org/pss/1909829.

  9. You’re not quite right – there is a way to win which I discovered when I was a schoolboy. Become the bookie.

  10. From: 49er
    To: matt@wmbriggs.com
    Sent: Thu, May 20, 2010 9:30:16 AM
    Subject: Fueling my car with water(Can you help me do it)?

    Do you have anything in FUELING MY CAR WITH WATER WHERE I CAN DRIVE MORE CHEAPLY?

    I have tried many SYSTEMS & METHODS since 1974, In California, Texas and New York. NONE OF THEM COULD WORK (HOLD WATER) FOR A LONG PERIOD OF TIME.

    PLEASE BE MORE CONVINCING OF WHY THE METHOD OF MR BRIGGS WOULD MAKE ME DRIVE CHEAPLY MOST OF THE TIME.

    SINCERELY YOURS
    49ER

  11. deaieme, or own a track. The bookie method can be back breaking work and the local guild, once known for their predilection for wearing fedoras, might be inclined to prove that to you. 😉

  12. David Walsh made his millions betting on the horses:

    http://www.abc.net.au/local/stories/2009/01/13/2465111.htm

    He’s a statistician and spends a lot of his time studying the form of horses on video.

    A guy I worked for in the 70s passionately wanted to be a bookie and eventually gained his bookie’s ticket. It took the other bookies just a week laying off bets with him at Randwick to wipe out his $250,000 seed money. So it goes…

  13. You place your bets with the bookies but you need to realize that you are betting against the other punters. You also need to have a much more intimate knowledge of likely place getters, riders and trainers etc than the average punter. But you can’t hope to have a better local knowledge than all the bookies at the track. And amongst likely place getters it’s still very much a game of chance. So the bookies have long been aware of the slight occasional advantage that the knowledgeable quad-core punter might have over the crowd and operate accordingly. At best you will lose your money a little more slowly.

  14. If you’re sure you are going to win, bet all you have and let the winnings ride until the casino throws you out.

    If you’re not sure you are going to win, bet an amount based on what you believe the odds of winning are and the payoff.

    If you know that the house will win, place the smallest bets allowed and enjoy yourself until you run out of money.

    Or … Bet $2 on every race and play the nickel slots.

  15. If the jackpot in Lotto gets large enough I can calculate that the expected value of my winnings exceeds the cost of the ticket. At least that’s what I tell my friends who are mystified that a rational person would gamble this way. Hey, look, if a person doesn’t make some room for serendipity it will never happen.

  16. For some reason, I find this post hilarious.

    I don’t gamble, unless you thing that investing in stocks is gambling, but I buy lotto tickets occasionally. I know that it’s very unlikely to win a lotto jackpot. Oooooh… but the joy induced by anticipation of winning outweighs the disappointment! And you know, it doesn’t help that the media reports only lotto winners’ excitement but never losers’ disappointments.

  17. Kevin,

    You’d think so , but expected value has little value in real life.

    Suppose the payout (after taxes, and considering you choose the up-front payment) for the Megamillions is (as it has been) $200 million. The “expected value” of the payout is Pr(winning | given information) * $200 million, which works out to be about a dollar and a dime.

    Now, just you try and trade that “expected” $1.10 for any object with a matching or lower sticker price. You’d be lucky to have any merchant trade it for penny candy.

  18. Kevin,

    The Bernoulli paper I linked above addresses the so-called St. Petersburg Paradox involving a (hypothetical) game which offers potentially infinite expected return and answers the question: “What would be a fair price to pay for entering the game?” Bernoulli introduced the expected utility hypothesis, and the presumption of diminishing marginal utility of money. This converted the problem to a concave utility function. As long as the utility function is “concave” (oddly meaning it looks like a hill crest), there is an optimum point. I think the concavity observation actually was made by Cramer. These are applicable to state lotteries as well.

    Bernoulli’s answer for someone with Bill Gates wealth is around $20 and for you and me about $5 to enter the St. Petersburg game. It also indicates that I’m vastly overpaying to play Powerball and Mega Millions but I can afford it so ask me if I care.

  19. And now the answer to the age-old riddle: “How to make a small fortune at X” (X=flying, boating, gambling, whatever).
    Answer: Start with a large one.

  20. Briggs,

    I fully understand your point about lack of value in the expected value — it’s just an answer I use. But I meant what I said about serendipity, and besides, around here the lottery supports parks and public spaces.

  21. DAV,

    I lived that joke about how to make a small fortune at X. For fourteen years I farmed and raised cattle.

  22. JH has hit the subject on the head. It is fun to contemplate a win while the lottery ticket is in play.

    DAV
    I’d not heard of the St. Petersburg Paradox before. Marginal utility is the answer to the paradox? Maybe so, but it seems to me easier to explain the issue as that of expected value being a poor measure of central value in this case and also in the case of the lottery.

  23. Lottery tickets —

    If you really did think you had a positive expected gain (which you don’t) the way to play is to join a syndicate that will buy a large number of tickets and split the winnings.

    The jackpot total is $100 million and my chance of winning is 1/50 million, so the game is in my favor to play, right? No.

    The chance of me winning the $100 million jackpot is significantly less than 1/50mm. When the jackpot gets high, a swarm of ‘Kevins’ (players who normally don’t play, but do when the jackpot is large) come into the game. Usually the mega-jackpots are split among multiple winners.

    Then the winnings are paid as an annuity, and then you will have to pay taxes on those winnings.

    So, play because it is fun, and because you won’t miss that dollar.

    It could be you! It probably won’t!

  24. If I remember rightly, Darrell Huff said, “The difference between insurance and gambling is the contingency that leads to a pay-off. Which is why insurance is sometimes necessary and gambling is sometimes fun”.

    Not finding any fun in seeing my money disappear I don’t gamble but there’s endless fun in speculating on “systems”.

    There’s also a lot of mileage in the response, “If you’ve got to ask then you’ve already lost” or in the Henry Root version, “If you’ve got to ask the answer won’t be any use to you”. But in a world of Diversity and Equality nobody wants to to believe it.

  25. Ah, the old St. Petersburg Paradox. Back in my MBA days, my Finance professor introduced this concept on day 1 to explain risk aversion and diminishing marginal utility of money. There are also other interesting examples of the limitations of expected value. There is the widely discussed “two envelope” paradox. I prefer the original version (courtesy of Wikipedia):

    “Two people, equally rich, meet to compare the contents of their wallets. Each is ignorant of the contents of the two wallets. The game is as follows: whoever has the least money receives the contents of the wallet of the other (in the case where the amounts are equal, nothing happens). One of the two men can reason: “Suppose that I have the amount A in my wallet. That’s the maximum that I could lose. If I win (probability 0.5), the amount that I’ll have in my possession at the end of the game will be more than 2A. Therefore the game is favourable to me.” The other man can reason in exactly the same way. In fact, by symmetry, the game is fair. Where is the mistake in the reasoning of each man?”

  26. St. Petersburg Paradox —

    There are a couple of ways to rationalise this one, that escaped Mr. Bernouli. The utility function isn’t really necessary. What is the couterparty risk? I may have a (1/2^21) chance to win 2^20 dollars by the rules of the game. But will I be able to collect my winnings? Am I going to have to pay taxes?

  27. good read! But there are few exemptions to the rule!

    I have been gambling over a year now full time! And it pays off my living expenses and my outgoings!

    Loses are inevitable but I can guarantee, if you follow your hard discipline and stick to low risks high reward gamble then over time it pays off! Good luck to you all!

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