Would you gamble on this - 2 ?

I bet yes. Just for fun. I enjoy a bit of a gamble.

Will enjoy a night at the Cas from time to time.

I wont say I am skilled at it. but I do enjoy a game. Generally beginers only. Im far better at playing the person than the cards so can often finish a game on top.
We play a weekly round when I am at work. I usually win enough that I return home at the end of a rotation with about equal money to what I arrived with.

My biggest win was when I graduated from my MBA. I could barely walk I was so drunk, and therefore was very hard to 'read' as I played so randomly. I walked away over $2,000 up, though it nearly ended in a brawl. Ahhh good times

Blacky

 

Main thing is you walked away with the cash

 

But I no gamble with property investing, only invest in sure thing!

 

smart approach, if you don't understand the risks then its too risky. nice one!

 

Is this a test in ones loss aversion?

 

Does your answer change if the numbers change? What if it's the same risk and reward, but you have to stake $100k (50% chance of losing the lot, 50% chance of finishing with $270,000)?

What about if it was $1,000 buy in, and the pay off if you win is $100,000. The catch is that you will only win 1.5% of the time, and lose 98.5%.

Both of these scenarios have roughly the same probability of return over the long run, but I suspect the willingness to take them up wouldn't be the same.

Purely based on the numbers, it makes sense to take them up and come out in front in the end. The problem with that (and this is why most fail to make money consistently in the stock market) is that emotion and human error come into play (not to mention other unknown factors).

For that reason, my strategy will always be based on numbers, but with risk mitigation and capital preservation rules as important factors in any decisions.

 

Still no, clearly I'm not a gambler.

I prefer the odds property investment gives me.

 

What coin is being tossed?

An Australian $2 coin is heads both sides, so if it's a $2 coin I'm in.

pinkboy

 

Of course it's smart, every real estate transaction I do is a sure thing!

 

What stock is that if you don't mind me asking?

 

I have to say no,maybe if you could flip 25- 60 times the odds would maybe be better ,,no one I have seen throws 25 heads in a row,i was only watching not putting money on anything..

 

No, No, No, No, No!

Not for the first scenario and most definately not for the second one.

Yes, the payout if you win is higher than the loss if you loose, but it is a one off. It could go either way.

On the other hand, in the first scenario in this thread if the odds were 50/50 and you could have multiple bets, then that changes it somewhat, in that you should always come out on top.

 

ASX:ALL - Aristocrat Leisure Limited.

pinkboy

 

The key factor is if you can afford to lose the the $1k.

If I couldn't afford it; I wouldn't do it; even with the "sweetener" on heads.

Something to consider;
1. I've seen plenty of rich people who gamble, but haven't seen anyone get rich from gambling.
2. Explosion of gambling site ads on tv sport; to be able to advertise so heavily, they must be able to make a serious amount of profit to spend on ads; i.e; your money.
3, And; casinos worldwide; they are not there to lose money. Some Casinos in Vegas have their own postcode.

 

He says 1 try...

 

These results don't make any sense at all.
In the first of the "Would you gamble on this?" series here https://propertychat.com.au/community/threads/would-you-gamble-on-this.2271/
The chances of a return on your $1,000 stake is 66.6% for a positive expectation of +33.3% profit.
Even at 66.6% chance of a return, only 40% of people would accept this, main reason being due to capital preservation.

Now, in this 2nd variation.
The chances of a return on your $1,000 stake is only 50% for a positive expectation of +35% profit.
At a reduced 50% chance of a return, a larger 50% of people would accept this, even with a higher risk of capital erosion.

Can anybody explain why more people would gamble on the 50% chance of return vs the 66.6% chance of return, when the gains are virtually the same, (33.3% vs 35%)
This makes absolutely no sense at all and may actually reveal that some people don't really understand probability related to risk vs reward against capital base.

However, I deliberately put "NO" as the first option in the first poll, and "YES" as the first option in the second poll.
Do you think that made a difference to perceptions?