What About Betting Your Entire Bankroll on a Sure Thing?

Utah · #1 10-11-2006, 10:03 AM

I didnt want to mess up Performity's great thread on tips so I started a new thread. However, I laughed when I saw it. Where does the following tip come in:

"Or course, if you think you have a lock in a UFC fight at -800 odds the correct thing to do is to bet your entire bankroll"

Or, is that it the tips for advanced bettors? lol [img]/images/graemlins/grin.gif[/img]

rjp · #2 10-11-2006, 10:05 AM

Thinking you have a lock and actually having a lock are two totally different things. Answer is no. [img]/images/graemlins/tongue.gif[/img]

Performify · #3 10-11-2006, 10:49 AM

Yeah, that's advanced bettors only.

[img]/images/graemlins/grin.gif[/img]

In reality though, I think it was a defensible play.

Most MMA handicappers would agree a 1% to 2% chance was accurate for Shamrock pulling the upset here. That translates to a line of -9900 or -4900. More importantly it translates in this situation to a 1% to 2% risk of ruin, which is very equivilant to what you get with a 1% to 2% of your bankroll unit following a normal season of "regular" sports betting. In some cases, my risk of ruin last night was much less than most people's you see posting picks in this forum, if my (and the general consensus) was correct about the "true" line on this fight.

My edge on this bet to the -777 line was around a +6000 delta to the true line, an edge of at least 10% in the line.

With this kind of massive perceived edge, on a 1%-2% risk of ruin, i'm going to take that bet and take it with as much as I can possibly bring to bear on the situation.

The reason this is definitely a very very unusual occurance is that this was the "perfect storm" of gambling situations. It was the difference between just thinking "oh this has to win, its a lock" and being able to quantify reasons as to why this fight should have been a -5000 line or higher. The perfect storm occured here because Tito has a more important title fight behind this, and has/had a genuine dislike for his opponent and such there was no worry of a fix or Ortiz failing to be motivated.

I guess I'm trying to say, I'd never bet this much on a line this high without this perfect combination of factors, but when I can quantify my edge and have such a high confidence level that my edge is correctly quantified, and that all external factors (existing injury, possiblity of a fix, etc) are accounted for correctly, AND have an acceptable risk of ruin... I think i've got to take the shot I did.

hogua · #4 10-11-2006, 11:28 AM

Even with this situation, I don't think you really want to risk your whole roll on this. The possible exception being that your roll is so small that you can easily recoup it.

Sure 99 times of a 100 you're gold, but that other 1% of the time you are now broke. After factoring in the opportunity cost of being broke, this costs you a lot more that the money you will win the other 99% of the time.

Thremp · #5 10-11-2006, 11:33 AM

I think his last line sums it up succintly. He's "taking a shot" so to speak.

Actually I don't think the opportunity cost of being broke is really super high for him. He's not a pro so he loses some income on the side, but its not devastating and can be replaced if he wanted it to.

MrDannimal · #6 10-11-2006, 12:08 PM

I think Perf pretty well explained that if you come up with a "system" with a 1-2% ROR that it doesn't really matter if it's 1, 100, or 1000 bets. Well, variance aside.

If you want to argue that "Well, if you start a system that has a 1% ROR with $1,000 and bet $20 per event you could quit if you lost $500." then your bankroll and ROR numbers are inaccurate (in reality, your BR was $500 which makes your bet size 4%).

SunOfBeach · #7 10-11-2006, 01:05 PM

I wish I had the cajones to make the bet that he did. I analyzed it the same way... thought the RORuin was about 1%... realize that's less than half of what my RORuin is in a typical baseball or college grids season... and still the cajones didn't win out. No question in my mind that Perf made a technically "correct" bet from a perspective of maximizing risk-adjusted return - it's just not a situation you'll see more than once in a bluemoon.

Spence · #8 10-11-2006, 01:45 PM

I think if the edge is high enough you should be willing to put your entire bankroll on the line.

Then again, I don't mind risk.

Dementia · #9 10-11-2006, 02:21 PM

Go for it. Forget all the little calculations, we're gamblers. You could excercise the tighest form of BR management for five years straight and still go 70% losers; making the most informed selections known to man. So why not have fun, get a little rush.

primetime32 · #10 10-11-2006, 02:52 PM

Betting youre entire bankroll in this sport is a little irresponsible. Its not the worst thing you can do, but it certainly goes against all notions of solid gambling we all have come to learn.

I am not as familiar with the UFC and i certainly follow those that are, but it seems like there is always some room for error considering all fights are capable of being fixed and since one lucky shot could knock a guy out.

Either way, he won and took down a big win so screw bankroll management!