How Much Are You Willing To Bet On The Toss Of A Coin?

[arrow_storm]

A completely random thought I had while talking to my friend the other day (completely irrelevant to that conversation as well btw).

So the question is this:
"What is the largest amount of money you would be willing to bet on the toss of a coin?"

As clarification, both the toss and coin are assumed to be fair and unbiased and winning would double your bet, while losing would (obviously) lose your bet.

Personally, I wouldn't bet more than $2 (just 'cos it's a coin) but my friend surprised me by saying he'd go up to $100.

Escapist, what are your thoughts on this?

 

[DefunctTheory]

50/50 is better then most gambling games that people bet THOUSANDS on.

At the same time, coin tosses are boring. I got 100 on those bones (Dice)!

 

[Dr. Pepper Unlimited]

Depends on how my money situation is looking. Currently saving to move, so probably no more than $5.00 on a coin toss.

 

[Jedoro]

$5, tops. I'm not big on gambling.

 

[BringBackBuck]

Come to Australia on ANZAC day. Just about every pub in the country hosts games of 'two-up' (It is illegal to play on the other 364 days of the year). You bet on the outcome of the two coins flipped simultaneously. People will bet hundreds on two up.
As an Aussie explained to me beautifully: it's 50/50 and the house doesn't take a cut, so if you play for long enough everyone should end up about square and a whole lot drunker.

 

[WolfThomas]

Not a lot of money. But my mate told when he was in Timor with the army some guys were betting upwards of $500 on a coin toss, they were that bored. Apparently thousands of dollars would go back and forth between the players.

 

[Cazza]

Whatever the value of that coin is. So max of $2. I only use coin flips if 2 people want say the last drink in the fridge.

 

[Zack Alklazaris]

You have a 1 out of 2 chance of winning. Thats better odds than the lottery, better odds than any casino game, hell its better odds than that "win every time" crane. (You don't always win).

I would bet 550 dollars or 1/3 of my usual pay. That way I have 2 more chances to make up for it statistically I should at worse come out even.

 

[arrow_storm]

Come to Australia on ANZAC day. Just about every pub in the country hosts games of 'two-up' (It is illegal to play on the other 364 days of the year). You bet on the outcome of the two coins flipped simultaneously. People will bet hundreds on two up.
As an Aussie explained to me beautifully: it's 50/50 and the house doesn't take a cut, so if you play for long enough everyone should end up about square and a whole lot drunker.

I'm an aussie so I know about two-up and all that, but aren't the odds 25-50-25 (heads-odds-tails)?

 

[CaptOfSerenity]

anyone ever seen No Country for Old Men?

 

[General Vengeance]

I need you to call it.

 

[isometry]

if you can only play once id probs just go 10 bucks or something, if i could play how ever many times i wanted however i would simply use the double up method.

Spoiler: snip

for those that do not know, say im fairly well off, i take 127k from my savings, i take it to this coin game and start, always betting on heads

the first bet i make is 1k

if i win i put the 1k to the side as my winnings and bet 1k again

if i lose i bet 2k

if i win that then i now have 101k, so i put the 1k aside and start again

if i lose i bet 4k and so on.

basically with this method and 127k i would have to lose 7 times in a row to lose my money, but every time i win i win 1k. if 7 times seems to risky then you start with something way lower.

btw dont do this in a casino, they will kick you out.

Interesting, the expected value has to be zero in the long run, meaning on average it shouldn't make money. But then, I asked myself, why would they kick people out?

To answer that question, I ran a monte carlo computer simulation. I simulated 100,000 gamblers all following this strategy for 7 turns. Here are the results:

The dotted line represents the starting account of 127k. This shows there are a lot of guys who profit about $5k-$15k, and a decent number of guys that profit $15k-$25k, and it all gets offset by a few guys who lose big.

The average account value at the end is in fact 127k as predicted. There are more winners than losers, but the losers lose bigger than the winners win. It's a risky way to make a living, but I can see why they would kick someone out for doing this, thanks for telling it to us.

 

[Phlakes]

That's a funny thing, I was bored recently, and there was a quarter on my desk, so I decided to test things. I flipped and called it thirty times, and got it right eight times. That's my luck.

So, I'm guessing we would be flipping a quarter, so I'll bet 25 cents and take the coin after.

 

[Dirty Hipsters]

50/50 is MUCH better odds than you'll get at any real gambling establishment, and hell, I've bet $300 before on roulette (black all the way baby), so I wouldn't be opposed to betting $300 on a coin toss.