You won't win

Arnold Snyder, a Blackjack expert talking about how impossible it is for most people to win at Blackjack using a Card Counting system with a proven long-term advantage, because it's too devastating to live through the short-term negative fluctuations. Everything he says applies perfectly to trading the markets, and explains why the majority of us will lose even with a proven "edge."

http://www.bjfonline.com/Library/wontwin.htm

You won’t win.

Do I really need fifteen articles to say those three words? I don’t think so. Though it occurs to me that all blackjack books should have at least one chapter titled: “You Won’t Win.”

The message delivered by most blackjack books and systems has always been the same baloney. Stanley Roberts’ Winning Blackjack was once advertised with the slogan: “Make every casino in the world your personal bank account!” Ken Uston’s Million Dollar Blackjack was promoted with: “Make $500 per day any time you want!” And these aren’t phony systems; these books contain legitimate card counting strategies.

You can’t always tell the real systems from the phonies by looking at the advertising. Promotion is promotion. Authors of blackjack books, like authors of all “self-help” books—from weight-loss systems to multi-level marketing programs—are reluctant to deliver the message:

You won’t win.

Nobody wants to hear it.

When I self-published my first book, The Blackjack Formula, in 1980, and advertised it in Gambling Times magazine with the catchy, upbeat slogan: “Card Counters Beware,” stating in the ad that most of the blackjack games available in the casinos of the world were unbeatable with any card counting system, the publisher of Gambling Times, Stan Sludikoff, told me bluntly that I would never make any great amount of money trying to sell books with that type of pessimistic advertising.

Stan was right. Seventeen years later, I’m still just scraping by, still delivering that vastly unpopular message:

You won’t win.

Of course, there are a few players who do win. Professional card counters exist; they’re not entirely mythical. It’s just that I know that these professional players are so exceptional, so obsessed, so dedicated, such gluttons for punishment, so terror stricken by the concept of working a nine-to-five job, so few and far between in every sense of few and far between, that, honestly, you are highly unlikely to be one of these human anomalies. And the most honest thing I can say to you, if you tell me that you really want to become a professional blackjack player, is:

You won’t win.

And the reason is: fluctuations.

If you are anything like the masses of humanity, if you like to be rewarded for your efforts within some reasonable time frame, you won’t be able to take the fluctuations. Those negative downswings will be bigger, and harder, and longer lasting, and more upsetting, and more unbelievable, than your level of toleration. Your losses will tear at your heart, and fill you with emptiness, and leave you in a state of quiet desperation. I hear this from players over and over again. I hear this from players who claim to have studied diligently, and practiced for hours on end, for weeks and months with a singular dream—to beat the casinos.

And they don’t win.

And they ask me why.

And I say, “Oh, it’s just normal standard deviation. A negative fluctuation. It could happen to anyone.”

But it happened to you.

Your money.

Your hours.

Your months of dreaming.

And you didn’t win.

So, over and over again, in my books, and my columns, and my magazine articles, I feel compelled to deliver the message I have been delivering since my very first book in 1980:

You won’t win.

Some card counters will win, but not you. Some card counters will actually experience inordinate positive fluctuations! Wow!

But not you.

You won’t win.

Other card counters will be having champagne parties in their hotel rooms, celebrating that marvelous life of freedom and money and adventure that just seems to come naturally with the lifestyle of a professional gambler. But not for you. You will be among the unfortunate few who, statistically speaking, will be located in the far left tail of the Gaussian curve. Someone has to be there. It will be you.

I have been in that tail; it is a cold and lonely place. I suspect many of those who write about this game have been there, and they know what a cold and lonely place it is. Every professional card counter I know has been there. And if they have played blackjack professionally for many years, they have been there many times. These players have hearts stronger than mine, and I suspect, stronger than yours.

This much I know: it is easier to make a living writing about this game than it is playing it. I have tried both, and I much prefer the keyboard to the cold green felt.

In any case, instead of filling an entire chapter of this book with some fifteen articles, written over a period of seventeen years, every one of which simply says, you won’t win, I’ve tossed the whole chapter out in favor of leaving you with just those three words of blackjack wisdom:

You won’t win.

 

Unless, of course, you have the intestinal fortitude to withstand the inevitable drawdowns without altering your system!

 

I'd wish people would think through some of these arguments. You can't take some article about blackjack and generalize it to trading.

The best blackjack systems give you like a half a percent edge. What does that mean? In an hour of play, you will win one more hand than you would by chance. You have to play perfectly.

A system with such a low edge will have HUGE drawdowns and in most cases the player will get taken out by chance. This is made even worse by player-harmful changes in blackjack payouts and rules, card counter tracking, tiredness, player errors.

You do think that successful traders are trading so that out of 50 trades they are winning one more trade than by chance? Real traders take money out of the market every day. They wait until the edge is much more than a half a percent.

 

I could say..."You won't lose the weight"(you won't win) every time someone
tells me their going on a diet.

And you know what...85 to 90 percent won't.


If you do, I could say, "You won't keep it off"(You won't win over
the long run).

And guess what...97% won't.

It's all about discipline!

Here's a post
I made awhile back. I think it's a perfect analogy to why traders lose.

 

Well of course,

It is impossible for most to win, otherwise there would be no markets or casinos.

 

There is no "proven edge". The markets consist of hundreds of thousands of people, and nobody knows how any one of them will behave in the future. If a system has worked every day in the last 30 years, it could still stop working today and never work again. Happens all the time.

 

Yes, you can win at blackjack. Bob did it years ago. And you will get kicked out of every casino for card counting. He also achieved that in Atlantic City.
He still gets up from the table with more than he sat down with. Though no BIG money anymore with 6 decks.
It can only be done with no mid deck reshuffle and up to 4 decks.
Works in Atlantic City and Vegas.....but New Orleans has funky rules and a constant shuffle which ruins it.

 

In both cases, trading and blackjack, the emotional toil of losing can result in the trader or blackjack trader 'giving up' even when they have a winning system.

Taleb in 'Fooled by Randomness' has a good chapter on this observation.

"...people who look too closely at randomness burn out, their emotions drained by the series of pangs they experience. Regardless of what people claim, a negative pang is not offset by a positive pang...it will lead to an emotional deficit." p.59

Describing a trader looking at his daily results "...being emotional, he feels a pang with every loss, as it shows in red on his screen. He feels some pleasure when the performance is positive, but not in equivalent amount as the pain experienced when the performance is negative."

It is possible to have a winning blackjack system or a successful trading system and still 'quit' because of the emotional 'pangs' of losing.

Statistics show everyone who quits as losers. It would be interesting to see numbers on how many people 'blow out' vs. how many just quit.

Taleb, "some behavioral economists estimate the negative effects [of losing trade] to be up to 2.5 the magnitude of a positive one."

The blackjack winners and successful traders experience this day to day and can balance thier 'emotional deficit' with positive knowledge of what they are doing over the long run. Others just quit.

Understanding your system and yourself, maintaining a long term perspective, and money management (risk of ruin) are key to staying in the 'game'.

To win, you must not quit. It can be done.

ramora

 

Thats the thing isnt it...some people DO win consistantly at these things...whatever it is, they consistantly make a profit over all. I hate these comments by people trying to bash the confidence for whatever reason of fellow traders. I see so much of the statistic "90%+ people fail".....its like many people are trying to just force doubt into your mind. Regardless if its true or not, im just amazed at the sheer amount of times its quoted everywhere. Its not "You wont win" its "You can win, but its hard going". If it really was true that you can never win then every trader in the world is a fool including the ones who say it.

 

Trading is just a perpetual video game. Every week I make a new high score.