I'm not exactly a math genius, but I know there are some here on the forum. Could anyone help me calculate this? Imagine that you have 8 possible results with gains/losses such as the following: -2 -7 +1 +2 +3 -2 or +1 or +2 or +3 -2 or +1 or +2 or +3 -2 or +1 or +2 or +3 I can calculate if they were fixed values, but I don't know how to handle these combinations with multiple possible results. Can you give me a hand and tell me if this has a long-term positive expectation?
Study a little conditional probabilities. That�s taught in any basic statistical course. There are free videos on Khan Academy, Coursera and YouTube. If you�re really interested in the subject, start there.
Thank you, I've heard about it, but I have difficulty applying it here. Could anyone show how it would be done with this exact example? It would be very helpful.
If you have no idea of statistics, don't get into calculating expectation. This isn't throwing dice. Without a minimal mathematical basis, you're going to draw the wrong conclusions.
See, if we assume that variable results have the same probability of occurring, we can calculate an average expected value for each. For example, if �-2 or +1 or +2 or +3� has the same probability, the average is (+1
In short: turn everything into fixed numbers using the average value of each multiple option. Then you make the total sum and divide by 8. If the number is positive, you have positive expectation.
Some of them come here from teachers and don't answer anything, the guy asked for practical help, not a theory class.
Let's calculate it together. The last three results have 4 possibilities each: -2, +1, +2, +3. Their mean is (?2+1+2+3
Eye, that�s assuming that the odds of each outcome within the �or� are the same. If they aren�t, then the expectation changes completely.
Well done. That shows that even if you have big losses, if the profits are frequent and controlled, you can be profitable. It�s not magic. It�s statistical.
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