How to Win with Game Theory & Defeat Smart Opponents | Kevin Zollman
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I am sure game theory and game theory type thinking has a place, especially at places like Renaissance Technologies.
However, as a side note, trading is not a zero-sum game because money continually leaves the game to commissions, fees, bid/ask, etc.
Illustrative examples:
Poker with a rake is not zero-sum.
One on one poker where there are no fees so that whatever one player loses the other wins is zero-sum.
(I prefer not to go back and forth on this. Zero-sum has an exact definition and so does game theory)
https://www.merriam-webster.com/dictionary/zero-sum
Definition of zero-sum
: of, relating to, or being a situation (such as a game or relationship) in which a gain for one side entails a corresponding loss for the other side dividing up the budget is a zero-sum game
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Poker with a rake is minus-sum / negative-sum.
However, some minus-sum / negative-sum games can be beat.
Terms like zero-sum do not signify if a game is beatable.
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Definition of zero-sum
: of, relating to, or being a situation (such as a game or relationship) in which a gain for one side entails a corresponding loss for the other side dividing up the budget is a zero-sum game
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[QUOTE="dealmaker, post: 4593322, member:
1) in zero sum games act counter intuitively
2) adopt a strategy that minimizes maximum loss
3) there is no one size fits all strategy[/QUOTE]
..........
Nice video but I am not sure if you misunderstand a few things so I offer comments:
1. The correct strategy can be either intuitive or counterintuitive.
3. Game theory wise, one size does fit all opponents in poker, tic tac toe, rock-paper-scissors , etc.
Perhaps one reason the video maker was saying that against truly bad opponents there is no one size fits all strategy is the implication that an exploitive strategy may often be better here.
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Illustrative example:
A. In a game of rock-paper-scissors, game theory would have you throwing each option one third of the time so that you would be unexploitable.
(Well.. theoretically unexploitable.. don't give off tells or get cheated, etc)
B. As a non-game theory exploitive strategy, we might throw extra paper if we knew our opponent favored rock; extra paper if we had a "tell" indicating rock was about to be thrown; etc.
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Side note:
Poker players often deviate between uninformed strategies and informed strategies.
1) in zero sum games act counter intuitively
2) adopt a strategy that minimizes maximum loss
3) there is no one size fits all strategy[/QUOTE]
..........
Nice video but I am not sure if you misunderstand a few things so I offer comments:
1. The correct strategy can be either intuitive or counterintuitive.
3. Game theory wise, one size does fit all opponents in poker, tic tac toe, rock-paper-scissors , etc.
Perhaps one reason the video maker was saying that against truly bad opponents there is no one size fits all strategy is the implication that an exploitive strategy may often be better here.
___
Illustrative example:
A. In a game of rock-paper-scissors, game theory would have you throwing each option one third of the time so that you would be unexploitable.
(Well.. theoretically unexploitable.. don't give off tells or get cheated, etc)
B. As a non-game theory exploitive strategy, we might throw extra paper if we knew our opponent favored rock; extra paper if we had a "tell" indicating rock was about to be thrown; etc.
____
Side note:
Poker players often deviate between uninformed strategies and informed strategies.
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