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Rule18
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Posted - 2011.02.18 07:42:00 -
[1]
Edited by: Rule18 on 18/02/2011 07:44:26 Okay, I've been working on developing betting systems to be implemented as part of a business plan. So far I have two unique models. I would appreciate feedback and analysis on them.
Both systems will use the following 1. Bet - 5mil isk 2. Security will be provided by transferring collateral to a third party 2a. collateral transferred/ 5mil = max number of bets placed 3. there will be 20 racers to bet on to win (no prior racing data) 4. 10% isk not paid to bet winner goes to corporation 4a. 10% isk not paid to bet winner goes to event sponsor/organizers 4b. 80% isk not paid to bet winner is divided amongst investors who put collateral down 5. once bets are paid out, collateral is returned to investors 6. should event be aborted all isk will be returned 7. should event be a "scam" isk will be refunded to betters 7a. investors assume full liability 7b. as of now myself and irl friends are the only investors
System 1 1. first 5 bets placed on a racer pay 5 to 1, second 5 pay 4 to 1 down to a minimum of 1.5 to 1. 2. payout for bets on an individual racer may not exceed 25% of collateral transfered 2 (alternate). payout for bets on an individual racer may not exceed 75% of collected isk (5mil * number of bets)
System 2 1. no odds are assigned 2. winning bet receives 50% of collected revenue (1/2 * 5mil * number of bets) 2a. winnings are distributed amongst bet holders based on % of number of bets 2b. if winning racer had 5 bets on him split between two ppl 2/3 respectively players would receive 20% and 30% of total collected revenues
*note that %s may change... just that in my excel sheet these two combinations of %s produced very similar results for 20 racers, 2bil collateral and random distribution of bets
Okay, as convoluted as that whole thing was... thoughts? opinion?
Your hep is much appreciated!
-Rule18
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Ave Volta
Perkone
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Posted - 2011.02.18 08:16:00 -
[2]
Who pays the racers?
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RED FROG ALLIANCE: Here, There, and Everywhere. |
Rule18
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Posted - 2011.02.18 08:21:00 -
[3]
Racers are paid with corporate donations (swapped for advertisement) and entrance fees. Don't worry, we take care of our racers this is just a discussion of the mechanics behind the gambling. Either system will work with similar results... just looking for feedback.
Although... nothing to stop a racer from betting... or filling slots with alts they wont use... but that's for another thread :-P
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egola
Amarr
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Posted - 2011.02.18 15:24:00 -
[4]
how exactly are odds determined? is it ship based, pilot based? max speed based? are they gonna use a stock ship?
also for system number 2, what if the ratio of winnings-betters are a bit skewed? take for instance you mentioned that winners will receive 50% of collected revenue, but assume that 80-90% of betters chose that same ticket are the winnings be done out of pocket? or is there a limit to who can bet what? for instance only 1 ticket per racer?
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Rule18
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Posted - 2011.02.18 19:39:00 -
[5]
in that case, if 90% chose the same racer and that racer won, they would lose money. the idea behind both systems is to incentives the diversification of betting. for example, if 90% of bets are on one racer, for a cheep 95mil you can claim the winnings on all other racers and dramatically improve your odds. but yes, i see what your saying.... don't knw if any respectable gamblers would knowingly make a bet that will pay out less than they put in (at best!)
Thanks for the thought.
-Rule18
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Lando Antilles
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Posted - 2011.02.18 19:44:00 -
[6]
Maybe you could just do a Parimutuel system? To do it well, would require scripting, but it's as clear cut as they come.
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Rule18
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Posted - 2011.02.18 19:55:00 -
[7]
right... because i totally know what that is... mind spelling it out for me please?
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Lando Antilles
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Posted - 2011.02.18 20:16:00 -
[8]
Originally by: Rule18 right... because i totally know what that is... mind spelling it out for me please?
Wiki much?
In short... 1- Everybody places bets on the outcome they expect 2- The house takes a cut (~10-20%) 3- The payout for any given bet is the (total ISK pool from all bets - house cut) / number of correct bets
If you scripted it, you could know what the expected payout for any bet would be in real time, otherwise, you can do it easily after the fact w/ Excel
You could do seperate pools for 1st, 2nd 3rd, or even quinelas/perfectas (look that up)
It would probably make sense to pay out the racers using the house's cut. (that's what happens IRL w/ horse-racing and jai-alai
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Rule18
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Posted - 2011.02.18 20:32:00 -
[9]
that sounds like my second system except the house's cut is 10-20% vs 50%. Also, paying the racers out of this % would effectively kill profit... the concept of separate pools is interesting and one we explored but abandoned due to complexity. not to mention, using that system it would still be possible for a bet to pay out less than was paid in. in fact, the only system here that guarantees a return on bets made is system 1.
something that bothers me with my system 2 and your proposed system is that the return on a better's bet will change as betting continues. it seems to me only ethical to allow them to "lock-in" a potential return on investment.
then again, if returns are "locked in" further betting on a single racer into the 1.5 - 1 range is unlikely...
-Rule18
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Grimhowl
Heroes of NewEden
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Posted - 2011.02.18 20:41:00 -
[10]
Originally by: Rule18 that sounds like my second system except the house's cut is 10-20% vs 50%. Also, paying the racers out of this % would effectively kill profit... the concept of separate pools is interesting and one we explored but abandoned due to complexity. not to mention, using that system it would still be possible for a bet to pay out less than was paid in. in fact, the only system here that guarantees a return on bets made is system 1.
something that bothers me with my system 2 and your proposed system is that the return on a better's bet will change as betting continues. it seems to me only ethical to allow them to "lock-in" a potential return on investment.
then again, if returns are "locked in" further betting on a single racer into the 1.5 - 1 range is unlikely...
-Rule18
Wouldn't designing a system that favors the gambler be sort of bad for business? I'd rather have a chance to win bigger amount (ie <20% house cut) and potentially make less than I put in (it's still a profit if I win, just not a big one). Any system where the house takes 50%... I just plain wouldn't give that a second glance. I don't want the world, I just want your half. |
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Lando Antilles
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Posted - 2011.02.18 20:42:00 -
[11]
Originally by: Rule18 using that system it would still be possible for a bet to pay out less than was paid in. in fact, the only system here that guarantees a return on bets made is system 1.
This only happens in a Parimutuel system if the percent of bets placed on the potential winner is greater than the house's cut. This won't usually happen for 2 reasons) - Racetracks aren't as evil as casinos and don't charge that big of a cut (Profit = Volume) - If you can calculate winnings in real time (or give a good estimate) people will see that they have a greater expectation of reward by betting on less popular outcomes (like a supply/demand process) and even out the bets
If in the RARE chance that you are supposed to pay out less than the min bet, then you suck it up as the house and at least give them their money back (you just make less ISK... and that's your own fault for setting up a one-sided match with a clear favorite!)
Originally by: Rule18 something that bothers me with my system 2 and your proposed system is that the return on a better's bet will change as betting continues. it seems to me only ethical to allow them to "lock-in" a potential return on investment.
Gambling != Investment
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Rule18
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Posted - 2011.02.18 20:52:00 -
[12]
well said, if you're volunteering to calculate real time i'm listening :-P our current plan was to update in public forum 2 or more times a day. information displayed would include total bet cap (based on collateral held by third party), number of bets on a current racer and current odds.
i see this venture as a sustainable business model... you raise a good question though... is it a casino or a race track?
what about my obligation to capital investors? with my two systems, worse-case-scenarios still yield 50% ROI for investors of which they keep 80% and the rest is funneled directly into corp expansion. with your proposed numbers, this % would drop to a consistent 30% effectively reducing ROI for capital contributors to 24% from 40%... now that i spell it out that actually doesn't sound too bad for a 72 hour investment.
mind giving an example of how a multi-pool example would play out ROI wise? my mind is kinda blown atm
The help is MUCH appreciated!
-Rule18
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Lando Antilles
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Posted - 2011.02.18 21:22:00 -
[13]
if you visit the wiki page, it runs through an example bet totals & payout.
I can't speak as to your ROI for capital investors. Frankly there doesn't need to be much in the way of capital investors, you just need trusted 3rd parties to hold bets (or collateral for bets). If you do have investors, then I would not give them a cut that pays more than 10-15% monthly. This would be a safe bet for them.
Most of you money needs to goto the clients (betters). The more 'fair' the game is the more they will play. And you need to pay your racers (or fighters?) well, since their talent is the initial draw anyway.
I'm not volunteering to run the odds real-time, that would require more programming expertise & time than I have. Though, I am sure that applications and spreadsheets do exist out there which would make this totally doable.
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Rule18
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Posted - 2011.02.18 21:26:00 -
[14]
our capital investors' capital is only held as collateral during a round of betting... suppose investors keep 50% of profit on the 30% house cut... 15% weekly ROI is good enough right?
then 20% can go to racers, 20% to corp and 10% to event sponsor... ya... ya i like those numbers (atm i am the only capital investor)
will do with the wiki page.
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Lando Antilles
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Posted - 2011.02.18 21:44:00 -
[15]
Edited by: Lando Antilles on 18/02/2011 21:44:54 Here's how I'd set it up:
All bettors deposit ISK/collateral to trusted 3rd party. This gives them a virtual account balance equal to 100% ISK + 75% of collateral. They can make as many bets as they want to using it.
House takes 15% cut, hosts event, pays out winnings to virtual accounts Next event... repeat.
A bettor can never make more bets than they can pay for. And if a bettor ever wants to withdraw funds from their virtual account, the 3rd party charges a 5% fee. This way they get compensated.
From the 15% house cut, 2/3 goes to pilots/fighters, and the organizers/promoters keep 1/3.
No need for any investors. This way bettors have a fair system (they only really lose ISK to other bettors), and the pilots &trusted 3rd party gets paid. The organizers are middle men and should be compensated as such.
The biggest problem will be preventing corruption (rigged races/fights) Good luck with that.
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Rule18
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Posted - 2011.02.18 22:07:00 -
[16]
an interesting idea... but i am trying to minimize third-party involvement as much as possible. i will strongly consider this as an option for future betting.
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egola
Amarr
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Posted - 2011.02.19 00:38:00 -
[17]
Originally by: Lando Antilles Edited by: Lando Antilles on 18/02/2011 21:44:54 Here's how I'd set it up:
All bettors deposit ISK/collateral to trusted 3rd party. This gives them a virtual account balance equal to 100% ISK + 75% of collateral. They can make as many bets as they want to using it.
House takes 15% cut, hosts event, pays out winnings to virtual accounts Next event... repeat.
A bettor can never make more bets than they can pay for. And if a bettor ever wants to withdraw funds from their virtual account, the 3rd party charges a 5% fee. This way they get compensated.
From the 15% house cut, 2/3 goes to pilots/fighters, and the organizers/promoters keep 1/3.
No need for any investors. This way bettors have a fair system (they only really lose ISK to other bettors), and the pilots &trusted 3rd party gets paid. The organizers are middle men and should be compensated as such.
The biggest problem will be preventing corruption (rigged races/fights) Good luck with that.
this pretty much explains Somer's website....why not just do that? or maybe do one like rothbard's website
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Lando Antilles
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Posted - 2011.02.19 00:54:00 -
[18]
Originally by: egola
this pretty much explains Somer's website....why not just do that? or maybe do one like rothbard's website
Wow. Great minds think alike, i guess. My thoughts are born of spending too much time at the Jai-Alai fronton.
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Rule18
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Posted - 2011.02.19 08:38:00 -
[19]
Will you please post links to either or both of those sites?
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Alexandre Nox
SOMER Blink Cognitive Development
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Posted - 2011.02.19 09:03:00 -
[20]
Shore.
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