Compare Risk of Ruin on Progressive VP (no cashback) Versus Non-Progressive with Cashback
March 7th, 2012 at 2:36:23 PM
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I was looking over the risk of ruin charts for a 6-9 jacks or better machine with 1.5% cashback (101.04% payback) and saw that this situation requires 3296 units of bank for a 1% risk of ruin. Now suppose you found a $1 progressive (no cashback available) that was capped at $6645 (this equals a 101.04% payback.) How does this change the risk of ruin? Or does it?
March 7th, 2012 at 2:56:06 PM
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It means you need more.
The variance is higher with the Progressive than the cash back. In one, you are getting a rebate on every play. In the other, you get a bigger lump sum on the rarest pay out.
If the variance is higher, the risk of ruin is also higher for any given starting bank balance.
The variance is higher with the Progressive than the cash back. In one, you are getting a rebate on every play. In the other, you get a bigger lump sum on the rarest pay out.
If the variance is higher, the risk of ruin is also higher for any given starting bank balance.
"Then you can admire the real gambler, who has neither eaten, slept, thought nor lived, he has so smarted under the scourge of his martingale, so suffered on the rack of his desire for a coup at trente-et-quarante" - Honore de Balzac, 1829
March 7th, 2012 at 3:11:47 PM
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I figured it would be more, but how much more? A lot or a little? Do you know the formula for calculating this?
