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Need help with monte carlo excell coin flip?

  • 06-06-2009 6:11pm
    #1
    j2u
    Closed Accounts Posts: 314 ✭✭


    Hi i need help in setting up a monte carlo excell sheet to simulate a coin flip .

    while i already know how to do this part its the xtras im not sure of how to do which are as follows:

    im trying to the same thing that declan meagher does mentioned on his webpage here
    http://www.declanmeagher.com/betting_bank&money_management.html

    "I set up a Monte Carlo type spreadsheet to investigate. Excel has a random number generator which I use to simulate the toss of a coin. I enter the probability of success of 50% and the odds I’m getting of 2.05 and it will generate a 1 for heads and 0 for tails. I also enter my bank of €1000 and the percentage of my bank that I wish to stake on each bet".

    Anybody know exactly how do all this?
    Thanks


Comments

  • #2
    j2u
    Closed Accounts Posts: 314 ✭✭j2u


    anybod have any isdea how to set it the type of monte carlo sheet listed above?


  • #3
    --amadeus--
    Closed Accounts Posts: 5,096 ✭✭✭--amadeus--


    You could write it in code but if you're pretty inexperienced then the formula:

    =IF(RAND()>0.5,1,0)

    will "randomly" select either a 1 or a 0. Press f9 to refresh a new set of numbers and copy teh formula for as many cells as you need


  • #4
    j2u
    Closed Accounts Posts: 314 ✭✭j2u


    hi thanks for the help, but do you know how i can do as described above?
    such as after i have that part mentioned above done how do i input the probability of what i want the odds to be ?
    basically as declan described on his website he set up an excell sheet like this and had a bank of €1000 and entered the probability of heads to be 2.05
    and then using a staking plan known as the kelly staking plan he bets 2.38% of his bank to return 4.879% (2.38*2.05).

    this is the part that i have no idea how to set up?

    Thanks
    Andrew


  • #5
    --amadeus--
    Closed Accounts Posts: 5,096 ✭✭✭--amadeus--


    j2u wrote: »
    he set up an excell sheet like this and had a bank of €1000 and entered the probability of heads to be 2.05

    You need to go back and re-read the article. The probability on a coin flip is _always_ 50:50. You're confusing odds with probability.


  • #6
    j2u
    Closed Accounts Posts: 314 ✭✭j2u


    Hi perhaps i have used the wrong terminology , i know the probability of a coin flip is 50:50 but what the article is referring to is that if you could back a horse at higher odds than it is statistically possible ie. the true odds.
    so a the chances of getting heads or tails is 2.0 but say for example you found a bookie offering odds of 2.05 for it to be heads, then you would have a 2.38% edge and you should make profit from backing heads over time.
    He ran this experiment with a €1000 bank balance on an excell sheet, I would appreciate it if anybody knows how to do the same thinghe did?
    Thanks
    Andrew


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