Applied Probability: A Beginner’s Guide to Beating the Odds

What if you could improve your odds of winning the lottery? And maybe even winning other games of chance? It all comes down to statistics and probabilities. Unfortunately, most people never take an applied statistics class. And that means they don’t know much about the card probabilities and lotto probabilities surrounding so many games.

Ready to boost your chances of winning? Keep reading to discover our beginner’s guide to beating the odds.

Basics of Probability

If you never took an applied statistics course, then calculating things like card probabilities may seem daunting. After all, fully calculating the odds involves quite a bit of math. Fortunately, understanding the basics of probability simply means understanding a very basic math equation.

Ultimately, probability boils down to this statistic. Take the number of ways something can happen and divide it by the number of possible outcomes. The result is the statistical probability of something happening.

Things are simple enough when you imagine the odds of a flipped coin landing on “heads” or “tails.” There is only one way to get the outcome (flipping the coin) and two possible outcomes (heads or tails). Thus, the probability of it landing on a particular side is 1/2, or 50%.

It gets more complex when you begin to apply the math to games. In Five-Card Draw poker, the odds of getting a single pair is 42.2569%.

How did we arrive at that number? There are actually 1,098,240 possible ways to draw and 2,598,960 possible hands. Divide the first number by the second and you get the probability.

And keep in mind this example is limited to Five-Card Draw. The odds are different with other kinds of poker and other kinds of hands, especially once you throw more players into the mix.

Examples Where You Need to Understand Probability

Even now, you may be asking yourself: is it really important to understand probability? The answer is “yes,” and there are multiple reasons why.

As we’ve already covered, understanding stats is a good way to understand games of chance. In games like poker, Kenny Rogers reminds us you must “know when to hold’em” and “know when to fold’em.” Simply put, you’ll never truly know when to hold and when to fold if you don’t know much about the probabilities of different outcomes.

Understanding stats is particularly useful if you are playing the lottery. As our guide will explain, an understanding of probability and a little applied math can help you understand your honest odds of winning.

And knowing about probability is even useful when it comes to surviving things like national disasters. You’ll have a better idea of where to buy a home and what kinds of insurance you need to purchase once you properly understand the likelihood of a flood or earthquake affecting the area.

Different Kinds of Odds

Another thing that makes probability for beginners difficult to explain and understand is that there are different kinds of odds. You can try to fully understand all three or simply have a working knowledge of how to convert the odds (more on this later).

First, there are fractional odds. When expressed as literal fractions, you will see things like the 50% coin flip odds being expressed as 1/2. However, these odds are sometimes expressed in different ratios or in plain text. In such a case, something like 20% odds would be expressed as 5/1 or simply “five-to-one.”

In certain kinds of gambling, decimal odds serve to indicate both the probability and the payout. For example, if you bet on a horse with 4.00 odds to win, then the “House” will pay out $400 for every $100 that has been wagered.

Finally, American odds (known to some as moneyline odds) use plus and minus signs to indicate the likelihood of someone winning and the amount you can win. For example, if a particular outcome is likely, then the odds may be -120. This indicates that you can put in $120 for a chance to win $100 as well as your original deposit back.

But if the odds were +120, this indicates that the outcome is unlikely. In those cases, you’d “only” need to put down $100 for a chance to win $120 as well as your original deposit back.

Why the House Always Wins

Even if you’re not a gambler, you’ve probably heard this phrase before: “the House always wins.” But is this always true? And if so, why is this the case?

The simplest explanation is that the “House,” whether this is a bookie, a casino, or a lottery conglomerate, determines a profit margin and then builds that into the odds. This is “the house edge” that gives them an advantage, especially over a large number of games.

On a long enough timeline, most players will eventually lose money to the house. And even players that are mostly winning are likely to see smaller winnings as the night goes on.

That’s why in a casino, many players offer simple advice: if you win big, you should take the money and run. The longer you play, the likelier you are to chip away at your winnings or even lose them completely.

The Lottery Misconception

Not knowing about statistics and probability can be really bad when you play the lottery. For example, too many players believe their odds of winning are 50%. The reason is that there are only two outcomes: they either win or they lose.

Obviously, things aren’t this simple with the lotto. Fortunately, some lottery will advertise your chances of winning by saying that players have (for example) a one-in-ten-million chance of winning. Obviously, these odds are much worse than 50%, and buying multiple tickets can only do so much (at the end of the day, a five-in-ten-million chance of winning may be 500% better than your original odds when you had one ticket, but you’re still not likely to win).

This is why it’s important to check your odds of winning and, if needed, calculate the odds for yourself. And once you know the odds, you can find lotteries you are likelier to get prizes from (such as scratch-off tickets).

How to Beat the Odds

Not you know more about things like card probabilities and lottery probabilities. But do you know who can boost your chances of a nice lottery win?

We specialize in helping lotto players find the best games to play and improve their odds of victory. To improve your own odds, come register for your account today!