Re: Who pays the vig: The loser or the winner??
Craig, both losers and winners pay the vig. I can understand why people think only the winner pays, but it's not correct. Every bettor accepts that if they do win, they only receive 91% of their bet back (assuming -110). As soon as they place this bet, they lose 4.5% of the value of the bet no matter what the actual outcome is. Saying that one or the other pays is not recognizing what EV is.
Poker gives a perfect example of what I mean. Say I play a tournament that has a $10 buyin plus a $1 fee ($10+1). Now whether I win or lose, I still pay $1 to the house. This is undeniable. You are paying $11 with a maximum return of $10. This is EXACTLY the same as betting at -110. For every $11 you bet, you will see a maximum return of $10.
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