I learned to like math. No everybody does. For example: the challenge is to take blindfolded a red candy from a jar. Their are two jars. The first one contains 100 sweets of which 7 are red The other ones are black. In the other jar there is only 1 red candy and nine are black. Which jar do people choose when they have one shot to draw a red candy?
Most people take the first jar. People lack skills in statistics and probability. But the odd in the second are 3% better. A 7 % chance against a 10 % chance.
If we are feeling good, we under estamated the risks, if we are stressed we over estamate the risk.
You have 2 kind a people in the field of financial choices. Satisficer and Maximizer, the last ones do their research and put their findings in an excel sheet. The first ones don’t read the terms of their mortgage.
I read the Terms and Conditions of the casino’s and make excel sheet of the chances in betting sequences to reach my goal. I don’t have to win every spin, I want to win the spin before my bankroll is gone. My bankroll buys me chances. If you throw a dice 3 times and one of them needs to be a six your chance is 1/6 + 1/6 +1/6 is 1/2. The chance of a squence go non six, non six and six is 5/6 x 5/6 x 1/6 = 0,11574027.
This is why progressive betting makes you money. You can loose 2 and make your profit on the third. Being patient an doing the math are the key to succes.
Are you a maximizer or a satisficer?
Link naar the sheet