# kelly-paper-experiment

If you start with $100 balance, and you make a bet with a 70% chance of winning.  If you win, you get $80.  If you lose, you lose $80.  

Do you take the bet?  Even more interesting, if you could keep repeating this bet over and over again, always betting 80% of your balance, should you do it?  

It makes sense, right, the odds are in your favor!  

### The actual answer - if you want to go broke, then yes

This blew my mind, how counter-intuitive the answer to this question actually is.  

This program runs 16 simulations where you start with a balance of 100 currencies.  You make consecutive bets, always betting 80% of your total balance with a 70% chance of winning each bet.  It then reports the results after ONLY 200 bets.  The result is the percentage of your returns (your end balance divided by your starting balance).

### Output

Notice the e-n at the end... these are very small numbers, with only one simulation winning out with 24441% return based on the original balance.  

* 9.615689177895335e-11
* 0.037253150033722274
* 1.3190245785864657e-13
* 1.0684099086550371e-11
* 0.0041392388926358116
* 0.004139238892635805
* 5.1101714723898945e-05
* 7.788708234095249e-09
* 244.4179173712515
* 5.67796830265542e-06
* 0.0041392388926358185
* 1.1871221207278168e-12
* 0.0004599154325150897
* 1.0684099086550387e-11
* 7.788708234095218e-09
* 0.0041392388926358116

In other words, given enough time, we're all screwed.

### Reference Video

[![IMAGE ALT TEXT HERE](https://img.youtube.com/vi/91IOwS0gf3g/0.jpg)](https://www.youtube.com/watch?v=91IOwS0gf3g)


### How to build this program yourself

1. Install go - https://golang.org/dl/
2. Clone - git clone https://deadbeef.codes/steven/kelly-paper-experiment.git
3. Build - cd kelly-paper-experiment && go build .