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June 15th, 2016, 03:59 AM   #1
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Optimal growth Gambling

Hi everyone new to this forum I have a question regarding optimal growth and risk

say we play a game 1-1 vs an opponent where the payouts are 2 unites for the winner and risk is 1. In other words is a winner take it all payout.
We belive we win 65% vs this player giving us a return of investment (ROI) of 30%.
We also have a total of 100 to risk in this game.
If we where to use kelly criterion we would risk 30% of the the 100 so 30 for optimal growth.

As this is clearly a very profitbal opportunity to play this game, but we just have $100 we might want to take in some investors.
We still have our $100 of our own money lets say for an investor we take a fee of 5% from whatever amount they want to risk.
Let say the investor wants to risk $100 also we would take a 1.05/100 $4.76 fee before the event starts?
This would give us $104.76 so 30% of that is $31.42 bet for optimal growth?

Let me know if i am making a mistake here.

thanks and looking forwad to being part of the forum

Last edited by thatguy78; June 15th, 2016 at 04:01 AM.
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