Risk-averse?
- Thread starter Cyrano
- Start date
Huge topic, but I want to keep it short.
The idea is that what most of us care about is earning money safely. A job is the easiest way to do that. It has EV (expected value) some nicely positive amount, and SD (standard deviation) = 0, there is no change from week to week in our salary. Thus the ration EV/SD = +infinity. That is as good as it gets.
If you make a very small amount at a table game, but the SD is huge, then EV/SD is very close to 0. This means you will go through wild swings while making very little. Not fun, this will wipe out most bankrolls.
Thus, at blackjack what is important is not getting the maximum EV out of every situation, but rather maximizing EV/SD. Traditional indices maximize EV. Risk averse indices maximize EV/SD.
For example, splitting T's right on the index number means you are putting out twice as much money for an EV that may be 2 cents higher. Do you really want to risk that "second" max bet when your EV on that bet is 2 cents? The RA index has you making that second max bet to split the T's when the EV on the second bet justifies the risk, in other words, the wild fluctuations (SD) are justified because the EV is finally high enough. Thus a much higher count is required in RA.
In general, RA indices are applicable whenever you are going to put more money on the table in +EV situations. Important RA numbers include T-T vs. 4,5,6, and doubling T against T or A.
Hope this helps.
--Mayor
The idea is that what most of us care about is earning money safely. A job is the easiest way to do that. It has EV (expected value) some nicely positive amount, and SD (standard deviation) = 0, there is no change from week to week in our salary. Thus the ration EV/SD = +infinity. That is as good as it gets.
If you make a very small amount at a table game, but the SD is huge, then EV/SD is very close to 0. This means you will go through wild swings while making very little. Not fun, this will wipe out most bankrolls.
Thus, at blackjack what is important is not getting the maximum EV out of every situation, but rather maximizing EV/SD. Traditional indices maximize EV. Risk averse indices maximize EV/SD.
For example, splitting T's right on the index number means you are putting out twice as much money for an EV that may be 2 cents higher. Do you really want to risk that "second" max bet when your EV on that bet is 2 cents? The RA index has you making that second max bet to split the T's when the EV on the second bet justifies the risk, in other words, the wild fluctuations (SD) are justified because the EV is finally high enough. Thus a much higher count is required in RA.
In general, RA indices are applicable whenever you are going to put more money on the table in +EV situations. Important RA numbers include T-T vs. 4,5,6, and doubling T against T or A.
Hope this helps.
--Mayor
As others have often said, Schlesinger's "Blackjack Attack 2" is a reference we should all have on our shelves. He treats RA indices in some depth in Ch. 12, Part II. The one which is farthest from the normal index is for doubling 10vs10. RA is TC=7 instead of 4. There are six others listed as well.
CK
CK