Casino Pros

The year 2012 was a sweet one for celebrity poker pro Phil Ivey and Cheung Yin “Kelly” Sun, a woman who would become known as the Queen of Sorts. 

Click here to read Part 1 of this article

As promised, at the end of this article you will find the questions with the answers to the challenging 21-question test given to the elite blackjack pros at the Blackjack Ball. Give yourself one point for each correct answer. (If you got 12 or more correct, you did better than all the blackjack pros that took the test.)

I thought I had completed my work on loss rebates when I published the First Loss Rebate Theorem (LRT1) in this post. Then my dog gave me a good idea on how to get a closed form for the quit-win and quit-loss points and it worked. That became the Second Loss Rebate Theorem (LRT2), given in this post.

Casinos use loss rebates as an incentive to draw high-limit play. The player who wins gets to keep 100% of his winnings. The losing player is given back a certain percentage of his losses as a direct cash rebate. Typical rebates range from 5% up to 20%, depending on the player’s bankroll and average bet. Loss rebates originated as a way to get players to quickly pay off a line of credit, but in recent years have become an expected perk of high-limit play. Many casinos now offer loss rebates on the big four: baccarat, blackjack, craps and roulette.

While much of the U.S. market shuns baccarat, it is the number one game internationally. The size of the wagers players make is stunning to watch. In Macau, for example, it is difficult to find a table with a minimum wager less than $100. The casinos are packed full of what we in America would consider to be high-rollers. And marketing understands that high-rollers want perks and cash-incentives for their play. Asian casinos use an essentially perfect solution to line up theoretical win with cash-incentive: non-negotiable chips (NN).

This post concerns significant errors in the article “Examining a Gambler’s Claims: Probabilistic Fact-Checking and Don Johnson’s Extraordinary Blackjack Winning Streak,” written by W.J. Hurley, Jack Brimberg and Richard Kohar [HBK]. This article appeared in the February, 2014 issue of CHANCE magazine, Vol. 27, No. 1, pages 31-37. Two of the authors, Hurley and Brimberg, are professors in the Department of Mathematics and Computer Science at the Royal Military College of Canada.

Loss rebate analysis has been a common topic in this blog. There's a good reason: it is one of the top advantage play opportunities worldwide. Exploiting loss rebates is how Don Johnson crushed Atlantic City. Previously, my key theoretical result was when I proved the Loss Rebate Theorem and gave a spread sheet to help work with that theorem.

As you may recall, Revel Casino had a 100% loss rebate promotion throughout the month of July. I wrote about beating it in this blog post. The question if this promotion was a good idea is still open. According to this article in the N.Y.