Originally Posted by Scotch78
Could somebody please tell me what the odds are of a 25 bet swing on 50/50 bets, and also what bankroll would be necessary to have a 0.001% risk of ruin?
If you have an advantage in the game, then you can compute your risk of ruin for playing indefinitely. That is, if you have 25 bets ( or buy-ins) , then the probability of busting with 25 bets is
if p=51%, then the probability of busting is (.49/.51)^25 ~ 36.78%
If we know the win-rate and standard deviation of the coin flipping game, then the risk of ruin is
r = e^(-B*2*wr/s.d^2)
The s.d is approximately 1 for p close to 50%.
r ~ 36.78% ( same as before )
If you wish to determine B with a ror of 0.001% for some p ,say p=51%
Then we use the same equation written in a different form
B = -s.d^2/(2*wr)*lnr
B = -1^2/(2*0.02)*ln(0.00001)
B ~ 287.82