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The Kelly fraction is the optimal geometric growth fraction. It by definition is the betting strategy that will grow your bankroll the fastest for a given trading strategy. If you had only a single spin, which better betting strategy would you use instead of Kelly? Remember: we have yet to...

Thanks for demonstrating why I have no use for MCS. There is no optimal strategy that ever risks total loss like the one above does. The first time the ball lands on a black number or the green number, you're done. That's nowhere near optimality.

k*E == (% of bankroll wagered)*(expected return per unit bet) == expected return to bankroll.

Yes, sorry I didn't catch that contradiction before posting. Assume you can make multiple bets on the same spin. Now I wonder if any of the interviewees passed this test, given how muddled the conditions were stated. :mad: :(

Kelly is the way to bet even if there's a one-spin limit. Your analysis is wrong.

Best combo so far: Bet 9% of bankroll on Red plus 9% of bankroll on R-16. Kelly == 0.179 , Expectation == 58/37 == 1.568 , k*E == 0.2806

Excellent analysis. I agree, the best bet is almost certainly going to be some combination bet, possibly of all three +ev singles. I love the challenge. :)

The initial bankroll wasn't doomed if you are a good poker player. That's why I changed it from the OP's original opening (there are no 'good' regular roulette players, only those who know how to stretch out their losing period). Let's assume you're a good poker player, you went to the...

There are three R-14 slots on the wheel. There is only one R-14 bet square on the table. So yes you get paid if the ball lands in any of the R-14 slots.

In regular roulette (the European variety with a single green number, not the extra lousy American variety with two green numbers), there are 39 possible single bets (37 numbers + Red + Black), none of which have positive expectation. In our situation above, there are 34 possible single bets...

It's impossible to know what the interviewers were looking for. The OP of the original thread never responded to any of the replies to his thread. There are several "good" answers and many bad answers so maybe any of the good answers would suffice. It's difficult to believe the interviewers...

If you bet on Red, the payoff is 1:1 if the ball lands on any red number (including R-14 and R-16). If the ball lands on any black number or the green number, you lose your bet on Red. If you bet on R-14, the payoff is 35:1 if the ball lands on R-14, otherwise you lose that bet. If you...

The bet payoffs are the same as for regular roulette. Only the probabilities are different.

There's a chance that you could lose everything. Does that concern you?

What about a combination bet on both Red and R-16?

:) Yeah, my bad. The OP said "you decide to play roulette in a casino". But I changed it because I figured anybody stupid enough to play regular roulette couldn't figure out the odds on the favorable game. :p

Interesting post found at another website: " We asked the following question of interview candidates, and gave them twenty minutes to formulate their answer. You decide to play poker in a casino. But on your way to the poker pit, you are lucky enough to stumble upon a promotional roulette...

Good luck.

Before you spend time trying to reinvent the wheel, what proof do you have it is worth it? Have you thoroughly backtested this thing and found it to be better than anything you have access to now?

An edge is positive expectation. As to your followup question, just test it the same way you would trade it: with multiple instruments. So you're multiplying a low trade count per year by the number of instruments you use. As to thousands of trades, you might downsize to hundreds of trades...