Even Money???

[ScottH]

Even money is the same as taking insurance (when you have blackjack, of course).

Let's say you have blackjack, the dealer shows and ace, and you take insurance. Let's assume for this discussion that the insurance bet is for half the original bet. Let's also assume that you're playing a 3:2 game. There's two scenarios.

1) Dealer has blackjack. Then your original bet pushes and you win the insurance bet.

2) Dealer does not have blackjack. You lose the insurance bet and your original bet is paid 3:2.

In either case, the net effect is that you win an amount equal to your original bet.

It may be the same as taking insurance, but that doesn't necessarily mean that taking insurance with a blackjack is the same as taking insurance with another hand. The 3:2 payment might have something to do with that.

As I said in the KO book they say insurance costs you 1/13 of your bet with a hand other than blackjack. But then they go on to say that insuring your blackjack only costs you 1/26. Since it costs less to insure blackjacks, I figure there might be a differnt index for taking even money.

 

[jihan3]

It may be the same as taking insurance, but that doesn't necessarily mean that taking insurance with a blackjack is the same as taking insurance with another hand. The 3:2 payment might have something to do with that.

As I said in the KO book they say insurance costs you 1/13 of your bet with a hand other than blackjack. But then they go on to say that insuring your blackjack only costs you 1/26. Since it costs less to insure blackjacks, I figure there might be a differnt index for taking even money.

3:2 payment has nothing to do with the difference between taking insurance on a blackjack vs any other hand. Insurance is a side bet. The payout on the original bet has no effect on the expected win rate of the insurance bet.

Insurance costs 1/13 of your bet because only 4 out of 13 cards are tens. You get paid 2:1 for each of those 4 tens, so you are expected to get back 12/13 of your insurance bet. I don't see how this situation changes if you have blackjack (assuming infinite deck, which is consistent with the cited 1/13 figure).

Unfortunately, I don't have KO. Is there an explanation or at least more context provided in the book around the 1/26 figure?

 

[zengrifter]

There is a difference IF the game pays less than 3:2. zg

 

[jihan3]

There is a difference IF the game pays less than 3:2. zg

There is a difference between even money and blackjack if the game pays less than 3:2. In particular, in a 6:5 game, even money is a great option for the player (stovepipe mentioned this in the second post of this thread).

If you claim that there's a difference in expected win rates for an insurance bet while holding a natural versus any other hand (as is apparently claimed by the KO book), then please do explain!

 

[ScottH]

3:2 payment has nothing to do with the difference between taking insurance on a blackjack vs any other hand. Insurance is a side bet. The payout on the original bet has no effect on the expected win rate of the insurance bet.

Insurance costs 1/13 of your bet because only 4 out of 13 cards are tens. You get paid 2:1 for each of those 4 tens, so you are expected to get back 12/13 of your insurance bet. I don't see how this situation changes if you have blackjack (assuming infinite deck, which is consistent with the cited 1/13 figure).

Unfortunately, I don't have KO. Is there an explanation or at least more context provided in the book around the 1/26 figure?

This is going to be very brief since I don't have a lot of time.

On p.35 of KO Blackjack they give the EV of a blackjack. 4/13(0)+9/13(+3/2)=+1 1/26. If you take even money your EV is 1. So by taking even money you are losing out on that extra 1/26.

I havn't looked at the math, but see if you can figure it out from that forumla given.

 

[ScottH]

There is a difference IF the game pays less than 3:2. zg

So the payout on the hand DOES impact insurance!

 

[jihan3]

This is going to be very brief since I don't have a lot of time.

On p.35 of KO Blackjack they give the EV of a blackjack. 4/13(0)+9/13(+3/2)=+1 1/26. If you take even money your EV is 1. So by taking even money you are losing out on that extra 1/26.

I havn't looked at the math, but see if you can figure it out from that forumla given.

Thank you for posting this. I understand where they are coming from now.

The 1/26 figure is the cost of taking even money relative to the original bet.

The previously cited 1/13 figure is the cost of taking insurance relative to the insurance bet. Of course, the insurance bet is half the original bet.

1/26 of the cost of the original bet is therefore equal to 1/13th the cost of the insurance bet. Thus, the cost of taking insurance on either a natural or any other hand is the same.

 

[zengrifter]

In particular, in a 6:5 game, even money is a great option for the player (stovepipe mentioned this in the second post of this thread).

You said it backwards. If I was offering a 6:5 game I would prefer the customers take even money than to buy insurance. zg

 

[ScottH]

If you read my previous posts you would see that I knew that insuring a blackjack is the same as insuring any other hand. Then I got confused by the figures in the KO book, so thanks for explaining that.

The payout making a difference is only for even money, not insurance. Even money and insurance are only the same thing on 3:2 blackjack it seems like. So it seems like if the payout is less than 3:2 even money is better than insurance, and if the payout is more than 3:2, insurance is better than even money. I may be wrong since I havn't put too much thought into it.

 

[jihan3]

You said it backwards. If I was offering a 6:5 game I would prefer the customers take even money than to buy insurance. zg

Here's my reasoning.

Assumptions: 6:5 game, player has a natural, dealer shows an ace. Player takes insurance. For ease of calculation, let's say the original bet was $10 and the insurance bet was $5.

Two possible outcomes:

1) dealer doesn't have blackjack. Player wins $12 on the original bet and loses the $5 insurance bet. Player wins $7.

2) dealer has blackjack. Original $10 bet pushes and wins $10 on the insurance bet. Player wins $10.

If outcome #1 is guaranteed to never occur, then even money is the same thing as taking insurance. Otherwise, I think it's to the player's benefit to take even money.

So I think even money is a good deal for the player when blackjack pays less than 3:2.

 

[jihan3]

If you read my previous posts you would see that I knew that insuring a blackjack is the same as insuring any other hand.

I see this now - this thread is so long that I forgot who said what (and I think I have ADD!).

So it seems like if the payout is less than 3:2 even money is better than insurance, and if the payout is more than 3:2, insurance is better than even money. I may be wrong since I havn't put too much thought into it.

I think you're right. As long as "better" means better for the player.

 

[ihate17]

Camoflauge or logic, or logic used for camoflauge

Guaranteed 1000 vs. 1035 average, sometimes ZERO. It would depend on both your BR and your camoflauge. Not taking insurance with a 1000 bet might look suspicious. As for the BS player, he's just a casual player anyway, so why not insure a big-bet BJ. zg

Say you are a quarter player spreading up to $250 or $300. Get a natural with a quarter bet and dealer showing an ace, you are willing to gamble the dealer does not have it.
Now you have a max bet out there. Fear (or the high count) makes you take even money. You can play it up, you hate taking even money but with that big bet????? So you take it.
Big bet out there brings the attention of the pit. You get a natural and now you hesitate on even money. Ask the pit. Most pits will tell you to take the even money, so (with the high count) you follow his advice.

I do not think I have ever been backed off because I do not take it on small bets and do on large bets, but they do not always explain why they backed you off down to specifics.

ihate17

 

[Cass]

Say you are a quarter player spreading up to $250 or $300. Get a natural with a quarter bet and dealer showing an ace, you are willing to gamble the dealer does not have it.
Now you have a max bet out there. Fear (or the high count) makes you take even money. You can play it up, you hate taking even money but with that big bet????? So you take it.
Big bet out there brings the attention of the pit. You get a natural and now you hesitate on even money. Ask the pit. Most pits will tell you to take the even money, so (with the high count) you follow his advice.

I do not think I have ever been backed off because I do not take it on small bets and do on large bets, but they do not always explain why they backed you off down to specifics.

ihate17

That's why I like to buy insurance. I want to "insure" my big bet. Even though i have a 5.

 

[dacium]

Well its got to depend on your bankroll.

If you can't take the variance and a willing to sacrifice long term winnings then take the insurance. Basiclly the odds of blackjack are 9/4 while they only pay 2:1.

The answer to the question is the same as the answer to this one:
Would you pay $1000 for a 1 in 100 chance at winning 1,000,000$?
You would if you had a bankroll of at least 100,000$. If you dont have a bankroll that big its not werth it.

If you can't stand to loose 4/9ths of your big bets then you must take insurance.

 

[ScottH]

If you can't take the variance and a willing to sacrifice long term winnings then take the insurance. Basiclly the odds of blackjack are 9/4 while they only pay 2:1.

If you can't take the variance then you shouldn't have placed the bet.