[Homer]

I am wondering if there are EVER any circumstances when it would actually make sense to give up a +ev coinflip situation? My first thought is no, but then thought: what if your entire bankroll wound up on such a coinflip?

If your entire bankroll wound up on a coinflip, you should definitely hedge. EV is just one part of the puzzle. Really, it all boils down to your certainly equivalant (CE). That number basically describes what amount of how much money you should accept (or give up) in order to avoid a situation with built-in variance. I don't quite understand how the formulas were derived, but luckily I am capable enough to program the formulas into Excel to figure things out for me. Here is an example:

You have a $20k roll. You bet $500 on a 3-team parlay getting 6:1. You hit the first two legs and are wondering if you should hedge the third. So, you plug into your CE calculator your bankroll ($20k), probability of winning (50%), probability of losing (50%), amount you stand to win ($3k) and amount you stand to lose ($500). The calculator tells you that your CE is $1011. In other words, even though your EV at this point is $1500, you should be willing to hedge if you can lock in any amount equal to or greater than $1011.

Of course, the real question is whether you should have bet that much to begin with.

Granted, that should NEVER happen w/ proper BR management.

Agreed, in most cases. Though I am sort of wondering if there are exceptions to this in cases of futures and other bets that involve huge +EV dogs. For example, if I had the opportunity to hit a bet like crockpot's 800:1 bet on the Tigers, I would have put a bunch of money on it and would have inevitably found myself hedging later. The question is, does that mean my initial bet was too large? I'm not sure.