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Old 09-11-2007, 02:53 AM
Boredom Boredom is offline
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Join Date: Feb 2006
Posts: 1,129
Default Re: how to calculate equity that isnt 50/50?

Basically if you can figure out the average result of a manageable number of trials, you're halfway there. In a coinflip (ie 50% x, 50% y) scenario, it's easy to determine the average result of 2 trials. One of x, one of y.

The more trials you do the closer your overall result will abide by this pattern.

Then there is simply to divide this average result of (in this case two) trials by (in this case two) to arrive at the average result of one trial.

So in a 75% scenario, we can easily find out what 4 trials will result in. Since 75%-25% is the same as 3-1, we take 3 of the 75%-likely scenario (in this case +100x3) and 1 of the 25%-likely scenario (-50x1), add these together (300-50) and divide by 4 for average result (since we have been studying the average result of what four trials would be).

The reason I was so longwinded in my response is that I don't think about this stuff enough myself, so thank you for the opportunity. [img]/images/graemlins/grin.gif[/img]
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