If Gambling Is All Probability, Why Aren’t Mathematicians the Richest People?

Sometimes, I look at forums to see what kinds of questions people are asking about gambling in general.

When I came across this question, I knew I had a doozy! A lot of people online are wondering, if gambling is all probability, then why aren’t mathematicians the richest people?

Some of this is speculation, but it’s all speculation based on the cold-hard facts surrounding gambling and mathematicians. Keep reading to learn reasons why mathematicians aren’t the most wealthy.

No Amount of Skill at Math Will Beat a Negative Expectation Game

Most gambling games have a negative expectation. This is especially true of casino games, but it’s also true for poker and sports betting unless you’re exceptional.

Here’s an example.

When you play real money roulette and make a bet on black, you have 18 ways to win and 20 ways to lose.

It will just help you avoid losing money.

And with 90% of the games and situations you’ll find in the casino, the casino has an edge that’s impossible to overcome.

And even with the games where a possibility of beating the odds exists, you still need to be able to execute such a strategy.

Such execution isn’t related to just understanding the math behind the games.

Just Because Someone Enjoys Math Doesn’t Mean They’ll Enjoy Gambling

When I think of mathematicians, I don’t think of guys wearing Hawaiian shirts and Panama hats shooting dice in the casino. I usually think of someone like Albert Einstein, who wore a grey suit and spent time in front of a chalkboard demonstrating how to solve math problems.

Think about the math teachers you had in high school and/or college. Making money wasn’t a priority for them, or they wouldn’t have been teaching school.

This isn’t to say that math teachers and mathematicians aren’t lovely people.


It just means that they’re not guaranteed to enjoy gambling just because they like math.

Probability Isn’t a Guarantee Anyway

Even if you do find a game where you can get a mathematical edge, in the short run, you can still quickly go broke. This is what’s known as “variance,” and it’s a big deal.

Gambling involves random events. You can make predictions about random events based on their probability.

I played poker online this morning for an hour, and I played perfect cards. I raised when I should have, called, checked, and folded when I should have, and I still lost my entire stack three times in a row.

It requires a certain temperament to deal with those kinds of losses, especially when real money is on the line.

I know that the chances are good that I’ll eventually win that back and then some, especially if I make logical decisions firmly grounded in math.

I also know that this isn’t guaranteed.

A gambling grandmother saw the reverse of this phenomenon years ago when she went on the longest craps streak in history. For four hours and 18 minutes, she rolled the dice without sevening out. That’s a 154-roll lucky streak.

The probability of that happening is worse than 1 in 1.5 trillion, but it happened.

You could easily run into a losing streak that lasts just as long or longer.


Mathematician or not, you need intestinal fortitude to withstand a losing streak as long as the winning streak that Patricia Demauro saw in 2009.

By the way, the average shooter rolls the dice just eight times before sevening out.

You’re more likely to win the lottery than you are to see a winning streak like this, but even much smaller losing and winning streaks can have dramatic effects on a gambling bankroll.

There’s More to Winning at Gambling Than Math

It should seem obvious that it takes more to win at gambling than just math. Look at the last point I made about the rare lucky streaks.

But even if you want to gamble professionally, you need more than just an understanding of how the math works.

Think about professional poker players, for example. Not only do they need to understand the math behind implied odds and pot odds, but they also need to be able to read the other players at the table. And they need to have the discipline to stay focused on their game 100% of the time.

Being able to bluff, as well as being able to conceal any tells you might have, are also essential skills.

95% of the people who play poker lose money in the long run.

And poker is the gambling game where you have the best chance of becoming a professional gambler.

Some Mathematicians DO Get Rich

You’ve probably read some interesting stuff about counting cards in blackjack. I’ve written multiple blog posts about the how and why of counting cards in blackjack.

But guess who invented card counting?

Sure, there were professional gamblers who had a general sense of how to count cards for a long time, but the first person to really systematize counting cards in blackjack was Edward O. Thorp.

And guess what?

Thorp’s a math professor.

He wrote the first book on counting cards, Beat the Dealer, which pioneered the approach to beating the casinos that professional gamblers have used for decades now.

Who else used these techniques to win money gambling?

Thorp, by the way, has gone on to take his expertise in probability to the stock market. He’s made a fortune running hedge funds and, according to Thorp, he’s achieved annual returns of 20%+ for almost 30 years now.

The Casinos and Sportsbooks Are Run by Mathematicians

Who do you think invents new casino games?

What kind of background do you think casino owners and managers have?

And what kind of expertise does it take to successfully run a sportsbook?

It’s easy to think that the only people who get rich from understanding math are gamblers, but the real moneymakers are the people offering the games.

And they use their knowledge of probability and statistics to create games that are attractive enough that gamblers will play them even though they’re almost guaranteed to lose money in the long run on those games.

The most important person in a sportsbook operation is the handicapper. That’s the employee who sets the lines for the games. If the handicapper does a poor job of setting the lines, the book gets lopsided action on the games and loses money.

These entrepreneurs and gambling-business owners might not have degrees in mathematics, but they’re still doing important math work that’s generating a profit.

They qualify as professional mathematicians just as well as anyone with a math degree.

And they get rich doing it.

Miners During the Gold Rush Made Less Money Than Prospectors

My accountant loves to point out that during the Gold Rush, people selling mining equipment to prospectors generally made more money than the treasure hunters themselves.

How does this apply to gamblers and mathematicians?

Do a search for gambling books on Amazon sometime. Try looking up what a poker coach charges. Do some research on how to go to a school for poker players.

Think about the price of a hotel stay in a casino. Also, consider the 10% commission a travel agent earns on that room. Imagine the thousands of dollars that run through the buffet in the casino.

Contemplate how much cocktail waitresses and dealers make in tips.

These are all analogous to the traders selling picks and shovels to the miners in San Francisco during the Gold Rush. They make plenty of money, and they do it with less risk.

At least some percentage of mathematicians make their money writing books about how to count cards or creating software that acts as a tutorial for perfect video poker strategy.

Conclusion

The implication behind the question (if gambling is all probability, why aren’t mathematicians getting rich) seems to imply that probability is nonsense.

That idea seems like conspiracy thinking and denial to this gambler.

The truth is that mathematicians are people with preferences and skills like anyone else. Some of these preferences and capabilities align with the goal of getting rich from gambling, but they don’t always.

This doesn’t mean you shouldn’t learn the basics of probability.

If you’re going to gamble intelligently, it’s imperative you understand how probability works, even if you’re not as good at it as a professional mathematician.