Gambling How it began Gambling For other uses of the word gamble see gamble (disambiguation)
Gambling How it began Gambling For other uses of the word gamble see gamble disambiguation The expected value of a bet for a bettor is the sum of the quantities obtained by multiplying the payoff (positive if one wins and negative if one loses) of Gambling How it began Gambling For other uses of the word gamble see gamble (disambiguation) Gambling How it began Gambling For other uses of the word gamble see gamble (disambiguation) Gambling How it began Gambling For other uses of the word gamble see gamble (disambiguation)

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Gambling. How it began.


For other uses of the word gamble, see gamble (disambiguation). "Gambler" redirects here, for other meanings see The Gambler. Gambling has had many different meanings depending on the cultural and historical context in which it is used. Currently, in western society, it has an economic definition, referring to "wagering money or something of material value on an event with an uncertain outcome with the primary intent of winning additional money or material goods". Typically the outcome of the wager is evident within a short period of time.

Legal aspects
Because religious authorities generally disapprove of gambling to some extent, and because gambling can have adverse social consequences, most legal jurisdictions limit gambling to some extent. Some Islamic nations prohibit gambling; most other countries regulate it. Most countries' laws do not recognise wagers as contracts, and views any consequent losses as debts of honour, unenforceable by legal process. Thus organized crime often takes over the enforcement of large gambling debts, sometimes using violent methods.
Because contracts of insurance have many features in common with wagers, legislation generally makes a distinction, typically defining any agreement in which either one of the parties has an interest in the outcome bet upon, beyond the specific financial terms, as a contract of insurance. Thus a bet on whether one's house will burn down becomes a contract of insurance, as one has an independent interest in the security of one's home.
Furthermore, many jurisdictions, local as well as national, either ban or heavily control (by licensing) gambling. Such regulation generally leads to gambling tourism and illegal gambling, the latter often under the auspices of organized crime. Such involvement frequently brings the activity under even more severe moral censure and leads to calls for greater regulation. Conversely, the close involvement of governments (through regulation and gambling taxation) has led to a close connection between many governments and gambling organisations, where legal gambling provides much government revenue, such as in Monaco.
There is general legislation requiring that the odds in gambling machines are fair (i.e. statistically random), to prevent manufacturers from making some high-payoff results impossible (since these have very low probability, this can quite easily pass unnoticed).

Actions typically not regarded as gambling
Emotional or physical risk-taking where what is being risked is not money or material goods (e.g., skydiving, running for office, asking someone for a date, etc.) Buying insurance, as the primary intent of the purchase is to protect against loss, rather than to collect All forms of 'investment' (stock market, real estate) with positive expected returns, economic utility, and some underlying value independent of the risk being undertaken Starting a new business, as time and effort are also being wagered and the outcome is not determined in a short period of time Situations where the possibility of winning additional money or material goods is a secondary or incidental reason for the wager/purchase (e.g., buying a raffle ticket to support a worthy cause) Prediction markets or knowledge exchanges where the outcome is to encourage the development of market-based mechanisms for resolving questions of science, technology, management, strategy, planning, policy, etc.

Gambling variables
There are three variables common to all forms of gambling:
How much is being wagered, the initial stake (in money or material goods). The predictability of the event. In mechanical or electronic gambling such as lotteries, slot machines and bingo, the results are random and unpredictable; no amount of skill or knowledge (assuming machinery is functioning as intended) can give an advantage in predicatability to anyone. However, for sports events such as horse racing and soccer matches there is some predictability to the outcome; thus a person with greater knowledge and/or skill will have an advantage over others. The odds agreed between the two (or more) parties to the wager; where there is a house or a bookmaker, the odds are (quite legally) arranged in favour of the house. The expected value, positive or negative, is a mathematical calculation using these three variables. The amount wagered determines the scale of an individual wager (bet); the odds and the amount wagered determine the payout if successful; the predicability determines the frequency of success. Finally the frequency of success times the payout minus the amount wagered equals the "expected value" The skill of a gambler lies in understanding and manoeuvring the three variables so that the "actual value" is positive over a series of wagers.

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Psychological aspects
Though many participate in gambling as a form of recreation or even as a means to gain an income, gambling, like any behavior which involves variation in brain chemistry, can become a psychologically addictive and harmful behavior in some people. Reinforcement phenomena may also make gamblers persist in gambling even after repeated losses. Because of the negative connotations of the word "gambling", casinos and race tracks often use the euphemism "gaming" to describe the recreational gambling activities they offer.
The Russian writer Dostoevsky portrays in his novella The Gambler the psychological implications of gambling and how gambling can affect gamblers. He also associates gambling and the idea of "getting rich quick", suggesting that Russians may have a particular affinity for gambling. Dostoevsky shows the effect of betting money for the chance of gaining more in 19th-century Europe. The association between Russians and gambling has fed legends of the origins of Russian roulette.
Types of gambling
Casino games
"Beatable" casino games
With proper strategy, a smart player can create a positive mathematical expectation.
Poker (Also recognised as a game of skill)
Blackjack -- with card counting
Video poker -- with proper pay table and/or progressive jackpot
Pai Gow Poker and Tiles -- player-dealt
Sports betting
Horse racing (parimutuel) Slot machines -- only linked slots when multi-player jackpots reach a certain point

"Unbeatable" casino games These have a negative expectation, players as a group will lose in the long run (unless they cheat).
Baccarat Craps Roulette (unless physical prediction is used) Keno Casino war Faro (All but extinct) Pachinko A pachinko parlor in Tokyo, Japan. Sic Bo Fan-Tan Let It Ride 3-card Poker 4-card poker Red Dog Pyramid Poker Caribbean Stud Poker Spanish 21 -- without counting Texas Hold'em Bonus Poker

Non-casino gambling games
Mahjong tiles.Some of these are played recreationally without stakes
Bingo (US|UK) Lottery Mahjong Dead pool Dice-based Backgammon Liar's dice Passe-dix Hazard Threes Pig Mexico Card games Liar's poker Bridge Basset Lansquenet Piquet Put Coin-tossing Head and Tail Two-up (Australian casinos offer versions of two-up) Confidence tricks Three-card Monte Shell game Carnival Games The Razzle Hanky Pank Penny Falls Six-Cat The Swinger The Push-up Bottle The Nail Joint Con Games (in bars) Put and Take The Smack The Drunken Mitt [edit] Fixed-odds gambling Fixed-odds gambling and Parimutuel betting frequently occur at or on the following kinds of events: Horse racing (see below) Greyhound racing Jai alai Football matches (particularly on Association and American football) Golf Tennis Cricket Baseball Basketball Ice hockey Rugby (League and Union) Snooker Motor sports Boxing Darts Cross-country skiing Biathlon In addition many bookmakers offer fixed odds on a number of non-sports related outcomes, for example the direction and extent of movement of various financial indices, whether snow will fall on Christmas Day in a given area, the winner of television competitions such as Big Brother, election results [1] , and so forth. Interactive prediction markets also offer trading on these outcomes, with "shares" of results trading on an open market.
See Sports betting below.

Gambling on horse races
Tokyo Racecourse in Tokyo, Japan.One of the most widespread forms of gambling involves betting on horse races, most commonly on races between thoroughbreds or between standardbreds.
Wagering may take place through parimutuel pools; or bookmakers may take bets personally. Parimutuel wagers pay off at prices determined by support in the wagering pools, while bookmakers pay off either at the odds offered at the time of accepting the bet; or at the median odds offered by track bookmakers at the time the race started.
In Canada and the United States, the most common types of bet on horse races include:
win – to succeed the bettor must pick the horse which wins the race. place – the bettor must pick a horse which finishes either first or second. show – the bettor must pick a horse which finishes first, second, or third. exacta, perfecta, or exactor –the bettor must pick the two horses which finish first and second and specify which will finish first quinella or quiniela – the bettor must pick the two horses which finish first and second, but need not specify which will finish first. trifecta or triactor – the bettor must pick the three horses which finish first, second, and third and specify which will finish first, second and third. superfecta – the bettor must pick the four horses which finish first, second, third and fourth, and specify which will finish first, second, third and fourth. double – the bettor must pick the winners of two successive races; most race tracks in Canada and the United States take double wagers on the first two races on the program (the daily double) and on the last two (the late double). triple – the bettor must pick the winners of three successive races; many tracks offer rolling triples, or triples on any three successive races on the program. Also called pick three or more commonly, a treble sweep – the bettor must pick the winners of four or more successive races. In the US, this is usually called pick four and pick six, with the latter paying out a consolation return to bettors correctly selecting five winners out of six races, and with "rollover" jackpots accumulating each day until one or more bettors correctly picks all six winners. Win, place and show wagers class as straight bets, and the remaining wagers as exotic bets. Bettors usually make multiple wagers on exotic bets. A box consists of a multiple wager in which punters bet all possible combinations of a group of horses in the same race. A key involves making a multiple wager with a single horse in one race bet in one position with all possible combinations of other selected horses in a single race. A wheel consists of betting all horses in one race of a bet involving two or more races. For example a 1-all daily double wheel bets the 1-horse in the first race with every horse in the second.

People making straight bets commonly employ the strategy of an 'each way' bet. Here the bettor picks a horse and bets it will win, and makes an additional bet that it will show, so that theoretically if the horse runs third it will at least pay back the two bets. The Canadian and American equivalent is the bet across (short for across the board): the bettor bets equal sums on the horse to win, place, and show.
In Canada and the United States punters make exotic wagers on horses running at the same track on the same program. In the United Kingdom bookmakers offer exotic wagers on horses at different tracks. Probably the Yankee occurs most commonly: in this the bettor tries to pick the winner of four races. This bet also includes subsidiary wagers on smaller combinations of the chosen horses; for example, if only two of the four horses win, the bettor still collects for their double. A Trixie requires trying to pick three winners, and a Canadian or Super Yankee trying to pick five; these also include subsidiary bets. The term nap identifies the best bet of the day.
A parlay or accumulator consists of a series of bets in which bettors stake the winnings from one race on the next in order until either the bettor loses or the series completes successfully.
(Similarly, greyhound racing offers a popular betting alternative to horse racing in many countries.)

Sports betting
See also main sports betting article
Betting on team sports has become an important service industry in many countries. For example, millions of Britons play the football pools every week. At sports betting, players may beat the bank.
Most jurisdictions in Canada and the United States regard sports betting as illegal (Nevada offers full sports betting and the Canadian provinces offer Sport Select - government-run sports parlay betting). However, millions engage in sports betting despite its illegality.
In Canada and the United States the most popular sports bets include:

against the spread - the bettor wagers either that the favoured team will win by a specified number of points or that it will not. Giving the points involves betting the favourite, and taking the points means betting the underdog. See point spread. A team covers the spread if it wins the game with the score modified by the spread. If Dallas and Washington are playing and the spread is (Dallas -7), then Dallas has to win by at least 8 points to cover. Half-point spreads are also possible and the spread may change.
against odds - the most popular types of bets against odds comprise simple bets that a team will win and over-under (bets on the total points, runs, or goals scored by both teams). In making an over-under bet, the bettor wagers that the total will exceed or fall short of a total specified by the bookmaker.
against a combination of odds and spread
In sports betting, a parlay involves a bet that two or more teams will win. In the United States gamblers have made the parlay card one of the most common forms of sports betting: here bettors wager on the outcomes of two or more games. If all their picks win, they collect. Most such betting occurs in workplaces. A teaser is one type of parlay where the bettor can alter the point spreads on the two games in the bet.
Events like the Super Bowl, and the Kentucky Derby are famous for bringing in sports betting.

A scratchcard is a small piece of card where an area has been covered by a substance that cannot be seen through, but can be scratched off. Under this area are concealed the items/pictures that must be 'found' in order to win.
The generic scratchcard requires the player to match three of the same prize amounts. If this is accomplished, they win that amount. Other scratchcards involve matching symbols, pictures or words.
Scratchcards are a very popular form of gambling due to their low cost. However, the low cost to buy a scratchcard is offset by the smaller prizes, compared to casino jackpots or lottery wins.

Other types of betting
One can also bet with another person that a statement is true or false, or that a specified event will happen (a "back bet") or will not happen (a "lay bet") within a specified time. This occurs in particular when two people have opposing but strongly-held views on truth or events. Not only do the parties hope to gain from the bet, they place the bet also to demonstrate their certainty about the issue. Some means of determining the issue at stake must exist. Sometimes the amount bet remains nominal, demonstrating the outcome as one of principle rather than of financial importance.
Betting Exchanges allow consumers to both back and lay at odds of their choice. Similar in someways to a stock exchange, a better may want to back a horse (hoping it to win) or lay a horse (hoping it to lose, effectively acting as bookmaker)

Arbitrage betting
Arbitrage betting, is a theoretically risk-free betting system in which every outcome of an event is bet upon so that a known profit will be made by the bettor upon completion of the event, regardless of the outcome. Arbitrage Betting, as the name implies, is a combination of the ancient art of arbitrage trading and gambling which has been made possible by the recent explosion in online bookmakers. The large numbers of bookmakers create the marketplace within which, theoretically, this form of arbitrage can be practiced.

Staking systems
Many people have formulated staking systems in an attempt to "beat the bookie" but most still accept that no staking system can make an unprofitable system profitable over time. Widely-used systems include:

Fixed stakes – a traditional system of staking the same amount on each selection. This method suits conservative punters if the stake remains below 5% of the bank.
Fixed profits – the stakes vary based on the odds to ensure the same profit from each winning selection. This method suits conservative punters well, although if the profitability of one's bets varies independently of the odds the bettor simply reduces his or her cash flow.
Due-column betting – A variation on fixed profits betting in which the bettor sets a target profit and then calculates a bet size that will make this profit, adding any losses to the target. For example, to make a target of $100 profit a bettor would wager $50 at odds of 2 to 1. If the bet loses, the target becomes $150. If the next bet is also at odds of 2 to 1, the wager therefore becomes $75. This type of wagering can prove ruinous in the long run.
Kelly – the optimium level to bet to maximise your future median bank level; the punter needs to estimate fair odds (in decimal odds) and then calculate the stake using:
A = W - (1 - W )/(D - 1)
Where: A = Percentage of the total bank to bet W = Percentage probability of winning (fair odds) D = Decimal odds (actual odds available) Martingale – A system based on staking enough each time to recover losses from previous bet(s) until one wins. It is usually applied to even-money bets such as red/black on roulette. The Martingale guarantees failure in the long run - it would only work if the bettor has an unlimited bankroll, the bookmaker has no limit on the size of bets and neither party ever dies. However, it can usually be used to gain a small win in the short run, given a bankroll large enough to survive a streak of five or six losses. Matherial: wikepedia
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