Method or Rule?

[userque]

This is moronic

You'll have to offer a more robust mathematical rebuttal.

Let's dumb it down for you:

Guy bets $100, loses.
Guy best $300, loses.
Guy bets $500, loses.
Guy bets $1000, wins. Up net $100 on the day. Goes home. Repeats tomorrow.

Now, is the above scenario possible, or impossible?

 

[userque]

While you're working on that problem,

Isn't it true that no matter the number of losses in a row, in our example, the last bet will always cover the losses, plus add profit?

 

[userque]

...So unless our hero never wins a bet, he'll eventually be in the profit? Are you still with me?

 

[userque]

Which brings us back to the original statement; which, apparently, blew your mind.

If you have unlimited funds a martingale system will eventually win back your original bet. That's why the house has a betting limit.

 

[userque]

 

[henry76]

Or more commonly known as "morons".

 

[henry76]

But is it you or me ? check this peach from userque "
Isn't it true that no matter the number of losses in a row, in our example, the last bet will always cover the losses, plus add profit?"
unless your spoofing us , I mean is anybody this stupid?

 

[deaddog]

The point , Henry, is that the house has the discipline to limit losses.

 

[userque]

But is it you or me ? check this peach from userque "
Isn't it true that no matter the number of losses in a row, in our example, the last bet will always cover the losses, plus add profit?"
unless your spoofing us , I mean is anybody this stupid?

Explain to us how what I said is not true, Henry.

Empty responses like, "this is moronic," or "is anybody this stupid" may make you feel smart (why, I don't know); but the reality is, none of your responses have pointed out any errors, nor have they explained whatever it is you are asserting.

 

[Overnight]

Thought experiments:

Guy bets $100, loses.
Guy best $300, loses.
Guy bets $500, loses.
Guy bets $1000, wins. Up net $100 on the day. Goes home. Repeats tomorrow...

I don't understand the confusion with this.

The real problem with this thought experiment, while fun and will bear out to be true regarding infinite money, has that one fatal flaw...Nobody has infinite money. Neat little intellectual exercise, but really bad trying to apply it to the real world.

In fact, if you read @volpri's posts, that is kinda' what he is doing in a way. Trade goes bad, he doubles his trade on the reversal to halve the amount of PA distance he needs to break even for loss recuperation. But if that method goes bad, which we saw in @johnnyrock journal update today, if allowed to continue it can lead to ruin.

There has to be a point where the trader just need to stop, and not let it accelerate.