How to Wash a Croc and Other Cool Stuff

Gambling Math
Use the expected-return equation. In four simple variables (if you have them) you can simplify any betting proposition (Heads! No, tails!) to a single value. If the result has a positive value, take that bet. Odds are you'll come out ahead in the long run. If negative, you know you're taking a risk, and how big a risk. To calculate expected return, multiply the odds of winning times the value of a win, then subtract from that the odds of losing times the amount of wager lost. For example, if you bet $100 each time on a long series of bets on the flip of a fair coin, the equation looks like this:

(1/2 x 100) - (1/2 x 100) = (50 - 50) = 0

In the long run, you'll be no richer nor poorer than when you began. Of course, you can get lucky or unlucky in the short run, but not in the long run. For a long series of $1 bets on a single number (35:1 payout) at an American roulette wheel (38 holes, including 0 and 00), the equation looks like this:

(1/38 x 35) - (37/38 x 1) = -2/38 =  -.0526

In this game, the "house edge" equals 5.26 percent. Put another way, for every $1 you put up to wager, you will, in the long term, lose 5.26 cents of it. Got it? Good. Now stop gambling.

Check out more casino math at TheWizardofOdds.com.