Lee Evans 2012 Baccarat Playing The Empire Fun And Profit

Playing The Empire for Fun and for Pro�t

A Gambler's Guide to

Baccarat By

Lee Evans

FUNDAMENTALS

* * * * *

PUBLISHED BY: Lee Evans on LeeWare Development

Playing The Empire for Fun and For Pro�t

Copyright © 2012 by Lee Evans

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A�cionados who tirelessly work the tables at casinos around the world.

Playing The Empire for Fun and for Pro�t

A Gambler's Guide to Baccarat

Chapter 1

Introduction

My gambling journey started on the week of my 40th birthday around August of 2011. As

part of a long custom, I make it a point to travel every year on the week of my Birthday

either to somewhere I've always wanted to go or to somewhere I've never been, my trip to

Vegas fell into the latter category.

A relative of my wife has a place in Vegas just o� the strip and o�ered to let my wife and I

stay there for a week. My wife was there on business, but I was on vacation, so like any

other tourist, I hit the strip and having never been inside a casino before, I was immediately

reminded of the video arcade rooms of my youth accept, this was for adults and instead of

simply playing for points or status, the real carrot is playing for money.

There was another thing that reminded me of my earlier experiences with arcade gaming

in general and that is, typically, at the beginning, when playing arcade games, if you were

not that good, you would lose all of your quarters. The people that were really good at

playing games could extend their play and get a lot of milage out of their quarters

therefore, I thought to myself, If I was going to engage in gambling I wanted to be good at

it.

While in Vegas, I studied up on the various table games and played a little slots (but didn’t

understand Casino Mathematics or really know what I was doing). I was able to determine

from my research that if I was going to play a table game, Baccarat appeared to be the

easiest and the fairest table game to play with a very low house edge. I took a pass on the

other table games as other table games require some hours to learn how to play

e�ectively and they are �lled with options and characteristics that make them much like

the slot machines, but not in terms of edge, but player experience. I do recognize that

there are propositions in the other table games like the pass and don’t pass bets in craps

or the black and red options in roulette that are similar to Baccarat but those are not

central to the game play like in Baccarat.

Fortunately for me, that same summer, Rivers Casino in Des Plaines Illinois was opening, so I

had a place to conduct my research and run my experiments. The best part, is that this

casino is only 4.5 miles from home and about 2.5 miles from work. For me, it is in the middle

of my two points of daily travel and convenient enough to go to on the weekends or

whenever I want. It is a ten to �fteen minute car ride. In addition to gambling, it is a cool,

safe place to grab a bite to eat, hangout, people watch and socialize and best of all (for

me at least) it is smoke free.

In terms of my personal disposition, I’ve been a responsible manager of my money for

virtually my entire life and as a result of that management, I’ve been able to achieve a level

of �nancial security. Which means that I am a�orded the opportunity to engage in a

practical sociological exploration of the challenges gamblers face and to understand the

ins and outs and the motivations of participating in what can be a fun and exciting form of

entertainment but for far too many, gambling ends up enslaving them into a life of misery,

perpetual loss and ruin both �nancial and personal.

Understanding how and why this happens, as well as how one may achieve some form of

balance is the primary aim of this book. The secondary aim is, to provide practical, technical

analysis of the underlying mechanics so that one might be able to transform the act of

gambling into a productive and more satisfying experience.

I know that it is one thing to study and to know the theory behind something and quite

another to learn the challenges of real world application. Therefore, if I was going to do

this, I �gured I had to submerse myself into the world of gambling to understand fully the

total impact of the real challenges that gamblers face, challenges that cannot be

appreciated by an abstract study of just casino mechanics. By becoming a card-carrying

casino patron, I learned enough about the psychological challenges to be able to fully

integrate the knowledge that I know intellectually with the joys and perils of real world

experience and better yet, I can see how it all ties together.

I started running experiments on the slot machines at Rivers Casino in Des Plaines, IL in

2011. It took about four months to fully understand the attraction, entertainment value

and perils of playing the slots. During my experiments, I played virtually every type of slot

o�ered by the Casino both on the main �oor and in the high- limit room before graduating

to the tables.

I ran many practical and observational experiments on the game of Baccarat as well as

collected a book of outcomes for further analysis and publication. I put in about 200 hours

of game play and observation. To fund this research, I opened a line of credit with the

casino so that I could buy in to each game for $5,000 to $10,000 per game. My slot play was

capped at $5,000 cash markers (slots have worse odds). Taking out markers is safer and

cheaper than using the cash cage or the ATM machines to gain access to your money as

the fees for such transactions when conducted from the casino are high. Using markers

has the added bene�t of using house money to play for house money. Obviously, it’s your

money when you win or lose. Markers are no interest 30 day loans that are extended to

casino patrons that have the capital to back the loans and a good credit history that is,

paying o� debts in full and on time.

Some of the practical challenges I had in conducting my �eld research included the

expense and time it took to try various methods, therefore, I had to fall back to reading and

studying everything I could on statistics related to casino games, gambling psychology and

casino math. The following research and analysis done by others was most helpful. Such

as; the work by a casino mathematician who runs the site

http://w w w.thewizardofodds.com , a blogger that runs the site ImSpirit located at

http://imspirit.wordpress.com Seth Theobeau who runs the site

http://targetbetting.blogspot.com and �nally, the archives of gaming Author Al Krigman

which can be found here http://krigman.casinocitytimes.com/archives/ as well as a few

others. I examined various di�erent betting systems, as well as, designed and tested my

http://www.thewizardofodds.com/

http://imspirit.wordpress.com/

http://targetbetting.blogspot.com/

http://krigman.casinocitytimes.com/archives/

own, which are modi�cations of other betting systems. The primary reason for doing this,

was to create systems that provided the best balance between action and risk mitigation

based on the characteristics of the game. To accelerate the trending analysis, I used four

methods; one was to play with chips and the outcomes books I compiled using win loss

patterns as recorded from live casino play. With this method, I was able to practice tactile

execution of betting approaches to increase my muscle memory of complicated betting

strategies such as hedging that is, running progressions against both lines in a single game.

With this method of analysis I was able to reduce the time it takes to go through 6 hours of

gameplay (240 hands) into about an hour of analysis. Second, I played using computer

programs this allowed me to accelerate my testing and analysis a little more. Third, I relied

on a bit of custom programming as well as the purchase of a program (Baccarat Buster)

that allows me to program in up to six di�erent sets of betting logic and then generate up

to 200 hours at a time of trending analysis. This program proved extremely valuable as it

tracked very closely to my other forms of analysis including live game play. I should note for

the record, that I recognize my methods do not produce statistically signi�cant outcomes

in a game that can have more than a quadrillion outcomes. However, I contend that �rst,

no human will live or gamble long enough to encounter every possible combination of

shoes that exist and furthermore, while there may be more than a quadrillion outcomes,

when you aggregate those outcomes into groups of shoes, you end up with shoes that

exhibit �ve common characteristics: Streaky, Choppy, Neutral, player Dominant and banker

Dominant. The obvious problem for players is that no one can see around corners.

Therefore, it is hard to know what you are getting until after it happens which is the

nature of the game, and the player is still therefore, forced into a binary decision at every

level which will either be right or wrong.

This brings me to my fourth and �nal method of testing, using this understanding and

perception of common shoe characteristics, I took the time to map out all of the possible

outcomes (excluding ties which skew the results - I will talk about this more later) and

composed two shoes of win/loss patterns starting from all losses to all wins. Not so

coincidently, in a perfectly balanced binary game, when you group the decisions in groups

of 4s or 5s (I use 5) are mapped out in every combination starting from all losses to all wins,

you get 32 blocks. These blocks contain a total of 160 decisions and all shoes are some

combination of these decisions. By stringing these blocks together from worse to best

you end up with a pretty good approximation (not absolute by any means) of worst and

best case scenarios. I can use these two shoes to quickly test the balance (gains/loss

ratios) of betting techniques quickly. My results, using these two shoes validate my

experiences at the table as well as the common refrain uttered by mathematicians

regarding playing systems against games of chance where the odds are bound to catch up

with you.

Therefore, I can concede that no matter what you do, the only thing proper execution of

betting strategy does is slow down the process of a particular gambler going bust because

at some point you will encounter a situation that produces a relatively negative outcome.

This is a mathematical inevitability in all games of chance especially those with negative

returns. Eliminating risks in Casino games is an impossible task but managing risk is entirely

possible.

I will provide you with many practical solutions for doing this.

Casinos are masters at psychology so much so that they understand the behavior of

gamblers better than most gamblers know themselves. The �rst real lesson I learned

about playing games in the casino is that the more you play, the less risk averse you

become. That is, new casino patrons are typically very guarded about their money and risk

small amounts of money during casino visits, however, the more you play, the larger those

amounts become, until you think nothing of risking amounts of money that would have

seemed unimaginable and certainly not reasonable at some earlier point.

The thing that every gambler must remember is that the casino is in the entertainment

business. Where they di�er from other forms of entertainment is the cost of entry and

participation is not �xed. This can be a good thing for a savvy casino patron because it

a�ords one the opportunity to go out, have a good time and even get paid for the

privilege. However, it is helpful to keep in mind that nothing in the casino is free. If you are

not paying for it, someone else is. This can be both a good thing and a bad thing. A good

thing when you can go there enjoy yourself and don’t have any out of pocket expenses.

Obviously, it is a bad thing when your night out costs you more money than you could have

justi�ed spending under any other circumstances. I hear a lot of gamblers blame the

casinos for their losses and many confuse this with the built- in advantage of the games

which the casinos are entitled to charge, after all they are facilitating the games. No

gambler likes to hear it, but the casinos don’t take money from casino patrons, people

bring their money into the casino and put it at risk. Now, the casino will do everything it can

to make separating a gambler from his money as pleasurable of a process as possible. But

they don’t tell you when to play, and how much to risk, those decisions are left to the

gambler.

Every gambler has a favorite casino game and for me and many others, (especially Asian

players) that game is Baccarat pronounced (Baccer-rah) or “Bac” for short. The word

Baccarat is an Italian word that means zero. The game is deceptively simple to play

however, as any seasoned player will tell you, the game has many nuances that can seem

to take a lifetime to master. In short, gamblers can make wagers on three positions; player,

banker or Tie. The outcome of each hand will fall into one of those categories. The

winning hand is determined by the hand totals that come nearest to 9. Face cards and 10s

equal zero and any combination of cards that result in numbers greater than ten result in

the 10 being dropped for example a 13 = 3 15=5 etc. If you placed a bet on the winning

spot, you will e�ectively double your money. However, if you placed your money on a

losing spot you get Baccarat (zero) which means you lose your money. Ties pay 8-to-1 and

is characterized as a sucker bet because the house edge is 14.36%.

The game has a 1.06% house edge on the banker bet but the casino charges 5%

commission on winning banker bets and a 1.24% house edge on winning player bets. The

house edge on the player bets which pay even money come from the fact that banker has

more complicated drawing rules which gives it an advantage. Which means that in the long

run, the banker will win more decisions than will the player. Therefore, if you are playing

mini-baccarat which is a faster version of the game were the dealer handles the cards and

the table minimums are $10, if you make a bet on banker you will win $9.50. A bet on the

player would pay $10. For a more comprehensive and complete guide on Baccarat, I highly

recommend “Baccarat for the Clueless A Beginners Guide to Playing and Winning” by John

May.

Chapter 2

Casino Gambling Fundamentals

Everything You Need to Know in a Nutshell

First, it is extremely helpful to learn a little (a lot actually) about casino math that is, how

the casino makes its money from your game play. You speci�cally, want to focus on things

like edge, odds, utility and volatility. These are all things that will have a lot to do with your

actual experiences in the casino. However, to save you lots of time and e�ort, the

underlying mathematics of all casino games are designed in such a way so that you will win

less when you win and lose more when you lose. This is because the games are structured

in a way that creates few paths to win and many paths to lose (odds). The games are also

designed so that statistically wins and losses cancel each other out. Therefore, the casino

has to build in an edge (one directional �ow of money) that makes sure they end up with a

positive amount at the end of a long series of trials, this in contrast, means that players will

end up with some number that is left of zero. In the short term volatility overwhelms edge

and Standard Deviation puts players ahead or behind at amounts which are either larger or

lower than edge would suggest. In simple terms, gambling is a perpetual cycle of booms

and busts. The more gamblers attempt to control these factors the more they increase

volatility.

Casinos have two and very real practical advantages over gamblers. First, funny money

(valueless casino chips and credits.) vs real money. When casino patrons play against the

casino, they are doing so using a very limited amount of real money. The casino on the

other hand, has at its disposal a virtually unlimited amount of money (valueless casino chips

and or credits) that it can leverage against 99% of its players. To put it another way, in

order to play casino games, you need to use real cash to purchase casino credits at a 1:1

ratio. However, what is happening in fact is that you are using real money to purchase

something that has zero value and it remains that way until you hit the cash cage to

convert your zero value currency back into real money. However, few gamblers do this for

a series of complicated reasons I will get into later and this only increases the casinos

advantage over them. This is because every gambler is locked into a game of marbles with

an opponent that has virtually an unlimited amount of marbles which means that he (the

casino) will be able to take all of your marbles before you can capture any signi�cant

number of his, while retaining all of yours. The second and most under appreciated

advantage casinos have over their patrons is time. That is, most casinos run 24/7 and even

if a gambler is able to score many successful victories over them, every time the gambler

plays, he’s giving the casino an opportunity to win its money back. Casinos will do

everything they can to keep gamblers playing especially after a big win. If there is one

thing you must know about gambling in a casino, and that is, the more you play the more

they make, and while you might be in it for the short term, they are in it for the long run.

The insights, re�ections and analysis o�ered here are primarily related to the game of

Baccarat but could be appropriate to any even money-two outcome game of chance like

the pass and don’t pass at craps or red and black in roulette. However, the underlying

mathematical mechanics of those games are not a part of my analysis.

Chapter 3

Establishing A Solid Foundation “-it is gratifying to rationalize that we would rather lose intelligently than to win ignorantly.” --

Richard A. Epstein The theory of Gambling and Statistical Logic .

Lesson 1

“The di�erence between winning and losing at casino table games

isn’t luck. It’s all about discipline.” Seth Theobeau

The �rst and most important lesson a gambler needs to learn is the di�erence between

earning money, making money and winning money.

1. Earning money involves trading time, and or energy for money. Most people earn money

by having a regular job that is based on a simple calculation you do X and you get paid Y.

2. Making money, Making money is a two step process:

Step 1 Make (earn) money.

Step 2 Don’t spend it.

That is, when your income exceeds your expenses, you will have some money left over,

some people think of this as disposable income. Let me say for the record, I don’t like the

term disposable, especially when it appears in the same sentence as income or money

because it implies that one has money they can put in a pile and light it on �re. I would like

to think that most people value the time that it takes to earn money and whenever you

don’t have to spend it, you made it!

3. Gambling to win money is an activity that is fundamentally di�erent from the �rst two

because you need to RISK money to WIN money. To make this a little clearer, when you

gamble you are not earning money because whether you’ll be compensated for your

e�orts or not is left to chance. Which means instead of there being one outcome to your

actions now there’s two. This small change has a signi�cant impact on our experience. If

you remember what we learned so far:

Time = earn money

Don’t spend = make money.

Win money = (maybe)

Winning money fails on another front when compared to making money, and that is, when

you are gambling you are not making money because to make money you have to not

spend it. Gambling forces you to spend money for the “chance” to win money. Therefore,

gambling is all about uncertainty and risk.

Just to get it out of the way, there is absolutely, no secret betting method system or

strategy that can ever eliminate the risks involved in gambling, it is a mathematical

impossibility. However, you can win money playing casino games. Virtually every gambler

who plays table games can tell you a story about winning money and that was the hit that

got them hooked. However, the road to �nancial ruin and personal despair continues to

be paved by gamblers everywhere who have not mastered the concept of knowing the

di�erence between earning money, making money and winning money.

Once you fully comprehend the di�erence between the three, then you can set

appropriate expectations and formulate a plan that will increase your chances of success

and minimize your risk of total disaster.

This brings us to something called the Utility Principle which boils down to: If an action

results in happiness then it is good however, if it results in pain or unhappiness then it is

wrong.

Lesson 2

Learn to recognize risks you are taking when playing games of

chance in an attempt to Win Money.

“The house's fat bottom line depends primarily on the fact that the vast majority of

gamblers have no idea of the negative odds they are challenging, and assume that

whatever the numbers may be, they don't apply to them .” Seth Theobeau

Here’s a short list of real challenges every gambler faces and as a result dooms them to

catastrophic failure, as well as, an all too predictable pattern of behavior which usually

results in a signi�cant loss of capital. Or as I like to say, giving your money away.

1. Assuming that it is possible to earn or make money in the casino (See Lesson #1)

2. Play games of chance with no real understanding of the underlying mathematical

mechanics or risks.

3. Failing to establish clear gambling goals.

Let’s take the last point �rst. Failing to establish clear gambling goals. In my observations

and interviews with other casino patrons, they all pretty much fall into a few categories.

First, there are individuals that have impulse control issues that is, while they say that

gambling is about making money (See Lesson #1) they are actually thrill and action junkies

looking for the next big hit. I suspect that most of these people started out like everyone

else, but due to the time (days, months or years) they have spent inside casinos, they have

become completely institutionalized. Some of them so much so, that many are surprisingly

quite knowledgeable even philosophical about the practical nature of gambling but seem

powerless when it comes to limiting the heavy losses they take on an almost perpetual

basis. This is possibly because they are completely out of balance and no longer have any

sense of risk aversion. Second, are gamblers that have tilted that is, they have lost so much

money in the casinos that they have enslaved themselves to spending any free moment

and virtually any money they have in the desperate and unfortunately hopeless attempt to

recover past losses. In other words, a classic case of pathological gambling addiction. The

third and �nal group, is composed of individuals that are at various stages along the path to

becoming members of the �rst two groups.

In my �eld studies, acting as a gambler myself, and observing others, I’ve been able to map

out the gentle lure to ruin that puts virtually all casual players of Baccarat and I suspect

other table games as well, on the path to becoming institutionalized gamblers. Which

means that they will ultimately end up as members of the �rst two groups, that is,

institutionalized and or pathological gamblers.

First, some of the games are fun to play and there is a pleasure factor. Second, gambling in

a casino is a communal experience. The casino for any regular patron is like a little village

composed of (regulars) which consists of casino sta� such as; dealers, pit personnel,

hosts, cocktail girls, and a host of regular gamblers. This is supplemented by a constantly

rotating cast of characters primarily composed of casino hoppers (gamblers that bounce

from casino to casino), part-time gamblers (those that visit the casino on a certain

schedule) and spectators, that is, people that come to the casino for other attractions

such as the social atmosphere it provides, like the bar, the club, the bu�et etc, these

individuals might place a bet or two, if any, but they belong to a largely transient group.

This atmosphere triggers a subconscious desire to be social and to hang out in a place

where the action is at. In addition, the casino sta� has been trained to be kind, courteous,

and respectful to the casino patrons, and this treatment, creates a subtle but powerful

ego boosting e�ect in the casino patron which deepens the attraction to spending time in

a place where he or she feels appreciated. When you spend hours at the table gambling

there is camaraderie in the shared joys of winning and the agony of defeat, there is

encouragement, support, sympathy, hostility, foolishness, gossip and other things.

Therefore, the act of gambling in a casino is an entertaining experience and in a very

practical sense, it is the experience that we are paying for. This coincidentally, is where

the problem starts. In other words, these deep subconscious desires for these social

pleasures create a con�ict which will override any rational rules you might have.

Now let’s look at the very real ways in which gamblers are disadvantaged when they don’t

understand the underlying mathematics. Baccarat is commonly understood to be a 50/50

game but due to the house advantage, the game is tilted so that the house enjoys a 51%

advantage which means by extension that the players are at a 49% disadvantage. Which

means by further extension, the highest con�dence level any player should ever place in

any outcome is 49%. The practical implication of this 1% house advantage, means that over

the long run, gamblers will lose more bets than they win. To overcome these odds,

gamblers have to perform at 52% or better and have to try to win more when they win

than lose when they lose, but this begs the question how does one do that? Before I can

answer that question, I have to talk about what people do to make it worse. It is a fact that

luck has little to do with winning or losing in Baccarat, money management plays a much

more central role. This will become clear as I begin to make my case.

The �rst mistake many players make is that they use tactics which are appropriate for

short-game play that is, just a few hands to score a win or take a loss and call it a day. To

play a long game which means they want to use the same short term plays to bet against a

larger number of decisions. The problem with this approach, is that while a gambler might

win at �rst, he or she will “lose it back” plus some due to the volatility of the game. Which

brings us to the main killer of players at the table, not having enough money to survive the

normal and inevitable down swings which can occur when playing the game for any length

of time. This causes players to respond in two ways which seem rational, but usually make

the situation worse. First, the player will “pull back” and start playing scared which means,

making very small bets in an e�ort to conserve capital or second, the player will respond

by pushing out larger and larger bets which will accelerate the losses until the player goes

broke because they couldn’t sustain the larger bets. When players start out winning, using

big bets they will keep betting at these high levels until all of their winnings and any money

they came with is back in the dealers tray. Other mistakes, include; betting within a tight

spread of 1 to 5 units so that any normal negative trend puts them behind and they can

never catch up, playing while impaired that is, playing when you are tired, when you are

tired, you are not focused and will begin to make mistakes. Drinking while playing makes

you erratic and reckless. Playing for too many hours without a break has the same e�ect

as you will become increasingly irritated which means irrational. Chasing losses, not

accepting that you are going to lose some hands or games. These are all forces that

contribute to failure at the table.

So what does success and discipline look like? For that discussion, we have to start with

the concept of what it means to set clear gambling goals, and for this, you need to

understand how several forces work against one another. These forces can be simply

stated as:

1. Objective (What it is you are trying to accomplish?)

2. Outcomes (How well you are doing in reaching your objective?)

3. Time (How long it takes to determine if you have achieved your objective?)

These three forces have a relationship that will become increasingly clear as we move

forward. Most gamblers have the stated goal of doubling their money and many will go for

broke trying to achieve this objective because they simply play too long. That is, the more

you play the more varied the outcomes and as a result, your chances of doubling diminish

with extended play. This is one of many reasons (I’ll cover the rest) gamblers �nish at a

loss. Therefore, gamblers have three practical options when it comes to playing:

1. Go for short-term maximum gain that is, double your stake or bankroll in the least

amount of time possible. This is called the Maximum Boldness Theory and has its merits in

the fact that if you are going to win, your best chance is to place a single wager containing

the amount of money you wish to win. Therefore, if you are trying to win a $1000 you

should place a single bet for $1000. If you win, you’ve achieved your objective and you can

go home. If you lose, you have your outcome and you can go home. This option takes the

least amount of time and is technically the most e�cient approach. In my observations, I

have observed a minority of people that play in this way.

2. Maximize table time, the �rst approach ignores the other lures of gambling and that is,

the entertainment factor. The act of being social and the thrill of actually playing the

game for a while. The best way to increase table time, is to limit bet size to near the

minimum, decrease the number of bets made that is sit out decisions. However, it should

be obvious, that this approach con�icts with the �rst approach on the following basis, if

you play e�ciently to meet your objectives, then you can’t play for that long. On the other

hand, if you wish to maximize your play time, then you will likely not be able to accomplish a

stated objective e�ciently due to the underlying mathematical forces. If you wish to

understand these underlying mathematical forces in mind-numbing technical details, I

highly recommend a book titled, “The Theory of Gambling and Statistical Logic” by Richard

A. Epstein. In my �eld observations and discussions with other casino patrons, most

gamblers appear to be locked in a vicious cycle between these two modes of play and not

many exercise the third option (at least not in a way that shows any kind of discipline) but I

suspect, that this is due to a lack of knowledge relating to the other factors which play an

important role in the gambling experience. Factors, I will discuss shortly.

3. Balance objectives with action, or to use a system which I like to refer to as methods.

Systems or methods don’t help you win as they don’t change the underlying mathematics

of the game, but they do however, signi�cantly alter your experience with the game. As

each system or method is really just a series of trade o�s which balance rewards and risks.

In a very general sense, discipline requires the mastery of several concepts and Seth

Theobeau who runs the site (http://targetbetting.blogspot.com/) lays out many of them

very clearly and I can summarize the most important points here:

1. Accept that luck is an irrelevance because it favors the house as much as the player and

recognize that the house advantage make it inevitable that over time, the smartest

gambler will lose more bets than he or she wins. Grasp enough math to know that if you

are going to lose more bets than you win in the long run, the only way you can win any

money, is to win more when you win then you lose when you lose (an objective which will

require courage at times).

2. Learn the best way to play these games head-to-head which means avoiding the money

traps such as tie bets and dragons which will end up costing you more money than you will

gain. Be fully aware of the negative odds you face knowing that the tiny house edge

enjoyed by the casino is far less of a factor in player losses than poor money management.

3. Know that winning requires a substantial bankroll (something the house knows too) and

that long-term pro�t without risk is a mathematical impossibility. Play consistently and

cautiously, knowing that what many people assume is conservative betting actually

increases the house’s already favorable odds. Study win- loss patterns and see in them

the simple truth that the key to winning is exploiting positive streaks in such a way that

cumulative losses can be recovered in fewer bets than it took to get into trouble in the

�rst place.

4. Never take losses personally because they are almost always temporary. Use your losses

as opportunities to learn something from being beaten.

Lesson 3

No one can see around the corner, predicting the future is more

unreliable than you think.

Baccarat is fundamentally a guessing game where gamblers attempt to predict the future.

Many players use di�erent kinds of systems and methods to use past outcomes to

determine future events. Yet others rely on what they feel like they know. The central

problem with any system or method that relies on the past to predict the future in games

of chance, is the cognitive bias that sees past success as evidence of inevitability and proof

that the method will be reliable for future use. However, in actual practice, the hit ratio of

guessing outcomes is shockingly low and therefore worse than line betting (always

betting on one of two outcomes). It should also be noted that studies of bet placement

systems reveal that they don’t perform better than line betting. In my trial of trying to

guess outcomes based on heuristics, my highest success count was twelve in a row. The

average was clusters of 2 to 6 correct decisions separated by much larger gaps of wrong

decisions. In my experience, it has been much easier to get a lot more wrong than right. On

an o� day, I was able to guess three out of every four decisions wrong! The mistake

gamblers make here is confusing skill with luck, that is, they place too much reliance on

speci�c cases of success which means by extension that they largely ignore the failures

which if examined, would likely outpace the successful guesses by a considerable ratio.

There are useful metrics in Baccarat (which I will cover later) that can be used to establish

a base rate (what is known) to make better predictions which can lead to greater

opportunities for success. To learn more about skill vs luck. I recommend Michael

Mauboussin “Sorting the Sources of Success”. In his book The Theory of Gambling and

Statistical Logic, Richard Epstein, a game theorist trained in physics, notes that there is no

way to assure that you’ll succeed if you participate in an activity that combines skill and

luck. But he does say, “It is gratifying to rationalize that we would rather lose intelligently

than win ignorantly.” Luck may or may not smile on us, but if we stick to a good process for

making decisions, then we can learn to accept the outcomes of our decisions with

equanimity - - Michael Mauboussin. Baccarat is a game that requires zero skill to play.

Chapter 4

Money Matters

The Fundamental Math Every Gambler Should Know.

At the end of the day, gambling in a casino is about money so much so, that gambling is a

multi-billion dollar a year industry. Where roughly 90% of the revenues come from slot

machines. The tables have better but varying odds. It is estimated that 5% of players

develop gambling addictions and of those players, their losses account for a quarter of the

casino pro�ts and to make matters worse, these are the same gamblers who have

committed themselves to spending long hours in the casino playing against the same bad

odds trying to win back substantial amounts of money only to be pulled further into debt

as the math of the games work against them. The rest comes from players who lose

unnecessarily large sums of money on a pretty regular basis due to lack of knowledge and

discipline when it comes to the underlying mathematics of the games. In this section, I will

unravel many of the fundamental concepts as well as provide some tools, tips and

recommendations (many of which I have been promising to get to). Since mathematics is a

complex subject, I will simplify everything into an easy to understand format.

Lesson 4

Understanding the Concept of a Negative Expectation Game

If Baccarat were a completely fair game, then the odds would be 50 / 50 but due to the

built- in house edge, the game is 51/49 where the casino gets the 51% and the players get

the 49% disadvantage. To fully appreciate the implications of the advantage /

disadvantage you have to understand the underlying mathematics. The casinos advantage

comes from the following mathematical formula

Pro�ts = (Total Wagers) x (Edge)

Therefore, the casino doesn’t really care if you win or lose an individual bet because built

into the game is the aforementioned formula that guarantees them a pro�t and this pro�t

is achieved with extended game play. So the casino will encourage you to play longer. To

illustrate this concept let’s look at a short sampling of examples:

We start by constructing four shoes which exhibit long term statistically correct outcomes.

Where in; shoe 1 banker wins, in shoe 2 player wins and in shoe 3 banker and player tie or

break even and the same happens in shoe 4 but in a di�erent way. It should be noted that

the cumulative e�ect of shoe 1 and shoe 2 is that banker and player break even. However,

over the long run, banker will have more events than the player so the casino charges a 5%

commission against banker wins. In the following examples we will look at how the casino

makes its money from heads up play that is, where the player places a wager on every

hand. To keep things simple, we will use the table minimums of $10 for every bet and the

player has a maximum bankroll of $100. I call this kind of testing an If analysis as in “what if”.

I will also attempt to point out the relative advantages and disadvantages as we walk

through the examples.

Shoe 1 banker Wins

1 2 3 4 5 6 7 8 9 10

P P P P T B B B B B

In our �rst example, If player bets banker every hand, he will make 10 wagers for $10 each

for total action of $100 The casino calculates that it will earn $1 = edge (.01) x total wager

($100) from the players total action. Let’s look at what happens when our player bets

banker on every hand. He loses bets one through four for a total of $40.00 . He pushes on

bet �ve and wins bets 6 through 10. When we examine the underlying mathematics we

see the following:

Total Action = $100.00

Bets Won = 5 ($50.00) - 5% commission for a net win of $47.50

Bets Loss = 4 ($40.00) subtract losses from net wins $47.50 - $40.00 = $7.50 pro�t. Here our

player risked losing $100 for a win of 7.5% but had to overcome 51% odds to achieve this

win.

In case this isn’t clear, lets look at the same game from the casinos prospective,

(remember they get the 51% advantage.) Let’s say the dealer starts out with $1,000 in

chips in his tray. (these chips have zero monetary value outside the casino.)

1. Our player buys in for $100 and the dealer gives the player $100 worth of chips. His tray

now contains $900 but he has $100 in cash in his drop box. At this point for all practical

purposes both parties are even.

2. The player loses the �rst four bets. The casino now has $940 in chips in the rack + $100 in

the drop box for a total of $1040.00. If the player has a stop loss and walks away from the

game the casinos hold is $40 that is money you left on the table and is therefore an easy

win for the casino. But for the sake of completing our example, our player continues to

play and pushes on hand 5 but wins the next 5 banker bets. At the end of the game the

player “colors up” and receives $107.50 in chips. The casino now has $892.50 in the tray and

$100 in cash in the drop box, this brings the casinos end of game total to $992.50. In this

example, the casinos outcome was the exact opposite of the player in that it risked $7.50

for the chance to capture $100.

Now, let’s look at what happens if our player doesn’t like paying the banker commission

and bets player on every hand: The casinos calculation for edge is the same, it will make $1

for every $100 wagered. Our player wins the �rst four bets, pushes on the �fth and then

loses the next 5. When we examine the underlying mathematics we see the following:


Bets Won = 4 ($40.00) net wins = $40.00

Bets Loss = 5 ($50.00) subtract losses from net wins ($40.00 - $50.00) = -$10.00 net loss.

In this example, the player’s edge comes from the fact that it lost to the banker events. In

this example, the casino got its $1 plus a hold of $9. I know that I’ve talked about holds but

haven’t explained the concept yet so let’s get it out of the way now. A hold is simply the

amount of money the player leaves on the table. This is usually the result of several things

such as; playing too long, going broke during a downswing, hitting a stop loss, making a

huge wager that loses and not being able to sustain that level of play or quitting when

behind or down. These things all increase what is known as a hold. Which is another way

of saying not only did you not win, but you gave the casino back its chips. To be completely

fair to the casino, they are not in the gambling business as much as they are in the math

and time business that is to say, they are not actively gambling against the players but

rather the mathematics of the games give the casino an advantage that would be nice to

have as a player.

Shoe 2 player Wins

1 2 3 4 5 6 7 8 9 10

P P P P P T B B B B

Let’s look at the math if player bets banker every hand for the above shoe.


Bets Won = 4 ($40.00) - 5% commission for a net win of $38.00


In this example, the casino received $2.00 from the commission charged on the banker win

and has a hold of $10.00. If our player had bet player every hand the outcomes would look

like this


Bets Won = 5 ($50.00)

Bets Loss = 4 ($40.00) subtract losses from net wins ($50.00 - $40.00) = $10.00 net win.

Shoe 3 Bank and player Break Even

1 2 3 4 5 6 7 8 9 10

P P P P P B B B B B

Now, let’s look at a couple outcomes where the events cancel each other out. player

bets banker every hand:


Bets Won = 5 ($50.00) - 5% commissions for a net win of $47.50


Notice, that without the commission our player would have broke even but due to the

edge, our player �nished with a net loss.

If our player bets player every hand:


Bets Won = 5 ($50.00)


Shoe 4 Bank and player Break Even

1 2 3 4 5 6 7 8 9 10

P P P T T T T B B B

One last example, this one will look similar to the last one except there are more pushes.

If player bets banker every hand


Bets Won = 3 ($30.00) - 5% commission = $28.50


If player bets player every hand:


Bets Won = 3 ($30.00)


Now, that you understand how edge functions and the di�erence between edge and

hold lets look at another related concept that is usually obscured by the action and that is

the �ow of money. If you go back and look through the examples I provided where I

showed one player betting banker and another betting player then imagine that they were

both playing the game together you will see that the loser pays the winner. Most of the

time, in the casino, this is what is happening, that is, payouts to the winners are being

funded by the losers. The casinos primary function is to facilitate the game and grab some

pennies from the action.

Lesson 5

Understand what it means to risk money to win money and how to

calculate your chances of success and failure.

When I �rst started playing baccarat, I had an all too common experience, and that is

during my �rst week for playing the game, I bet player every hand (I was intimidated by the

banker commissions) a condition made worse with up to �ve people betting on my

position. During that week, I was able to net about $230 x 5 = $ 1,150.00 per game this was

achieved through a combination of sitting out banker runs and being fortunate enough to

encounter player dominant shoes. So like any gambler who doesn’t know any better, as

well as the many people I talked to regarding their initial attraction to the game, I thought

to myself “If I could “make” (see lesson 1) $230 per game every time I play, then If I played

multiple games in a day I could increase my “earnings”. I emphasize the words make and

earnings because like most gamblers I was naive in assuming that the time I was investing in

playing the game would result in a �xed rate of return. So to run this particular

experiment, I started playing �rst thing in the morning and played all day until late at night.

Everything was going well, I netted another $660.00 for a total of $1,810.00. If you’ve been

gambling for any amount of time you know what happens next and even if you haven’t, you

can probably guess. (I will wait for you to �nish laughing). So the shoe starts out with a

pretty solid player streak for the �rst 20 hands of 80. player = 15 banker = 5. The next 20

hands were the exact opposite with banker going 15 to players 5. The next 20 hands after

that hands 41-60 were banker runs and ties, The next 20 hands after that were more

banker runs some ties and only single player events. The �nal score was something along

the lines of banker = 50 Ties = 15 player = 25. player lost by 25 points! The probability of this

happening is 1 in 769. In terms of player response, (see lesson 2) I panicked and started

playing scared, as I had already lost all of the money I won in the this shoe betting against

the banker run. Then, I became despondent and went on a gamblers tilt that is, I started

shoving out larger and larger bets, bets for which I was losing 4 out of 4. Every time I could

win, I got a tie. It was the worse gambling day of my life. I went from a positive $2000.00 to

negative $2,790.00 which is a $4,600.00 swing in fortune in a single game. In my last

desperate attempt, I wandered to a random table and without even looking at the board, I

placed the last $800.00. I had on player (a bet I fully expected to lose) and won! After

winning that bet, I immediately headed to the cash cage to settle my debt which totaled

$1,190.00. Needless to say, I learned several very valuable lessons from this experience

and over time, with disciplined play, I cut my net loss to zero. During my other �eld

experiments at the tables, testing di�erent betting systems and methods, my net loss

would range between $0 which is break even and negative $1,700.00. Once I got several

things �gured out, I was able to go from negative $1,190.00 to positive $6,090.00 a swing in

fortune of $7,280.00. This streak lasted for �ve months straight with an average win of

about $200 per game. I became known amongst some of the players as; “the guy that

never loses”, “the professional” and the “the guy with the big money that bets small”. Well,

in a bout of recklessness I broke my winning streak by doing a few things. First, I had taken

to putting up all of my winnings from a shoe as a single bet to double my wins. Most of the

time, I lost these bets which means that I broke even. Other times, I would split my

winnings into two or four bets and would try to double. This resulted in mixed results but

usually had me chasing my winnings to break even. Second, I tried a new system without

properly testing it and it resulted in a $1,000.00 loss that I subconsciously decided that I

couldn’t except after such a long winning streak, that I decided to chase it a little bit

(something you should never ever do. DO NOT CHASE YOUR LOSSES YOU WILL ONLY MAKE

IT WORSE!) By chasing my loss i turned a $1000.00 loss into a total loss of $2,500.00 in a

single game. This one game blew away half my winnings. Third, I blew away the rest of my

winnings as well as managed to take a net loss of $800.00 by returning to using a playing

method which relies on a tight spread of 1-6 units, (this is the range between your lowest

bet and your highest bet.) I will get into the math of this later, the good news, is that I have

climbed out of the hole and I am marching forward. The overall, point of me sharing this

personal story is twofold; First, to illustrate that I understand at a personal level the

psychological and emotional challenges a gambler faces. And second, to illustrate that

this game allows you to hang yourself therefore, if we could stop hanging ourselves as

gamblers and leave it to the math which is the real determinant of our success or failure at

the table we would have consistently, more positive experiences.

Gambling is about choices and every choice you make has consequences. In this lesson we

will look at two choices, First, is establishing a lifetime gambling bankroll. Second, is how

to understand and calculate the risks you are taking when you decide to gamble.

Rule 1: Never gamble with money you cannot a�ord to lose! (see lesson 1) I am not saying

that when you come to the casino you should expect to lose or try to lose but what I am

saying is that the only way you can stay o� the slippery slope of chasing your losses, going

on a gamblers tilt, cursing out the sta� and generally not having a good time is to play with

money you value and need for other things. Therefore, you should never borrow money

from your credit cards, take money out of your savings, 401k, or bring your rent money,

babies food money, or the money that you’ve spent all week working for to the casino.

Because when you lose it, you will not be able to let it go because your �rst mistake was

using money that you couldn’t a�ord to lose.

Your gambling budget should consist of money you would have spent in some other

capacity, for stu� that you might not need like going to the movies, dinner, your 400th pair

of designer shoes or vacation money. For example, my number is $10,000. It is about what I

spend on a really good vacation, which I typically take once a year but for several years I

didn’t take the vacations or at least not any that cost me $10,000 so I take one third of my

vacation money and use it as my lifetime gambling bankroll. Mathematically, with

disciplined play, a bankroll of this size will allow me to play the casino for approximately

90,000 decisions or 1,125 shoes or 2,812.5 hours. To put it another way, about 4 months

straight if I played 24 hours a day at a cost of roughly $9.00 per game which represents the

casinos edge. This doesn’t mean that after that many decisions I’ll be broke, but what it

does mean is that by the time I’ve played the casino for 90,000 decisions it would have cost

me $9,000.00 which I will pay in two ways, by losses or in terms of reduced winnings

de�nitely a combination of both. (see lesson 4).

If you don’t want to become an institutionalized gambler, you need to pick a number that

represents a total fractional amount of your discretionary wealth and once you lose that

amount, then your gambling career is over period. If you have already started gambling

which I can imagine that anyone reading this probably has, then I would recommend that

you ask the casino for a win loss statement. because you can’t really play with any sense of

accomplishment if you have no idea about how far you are in the hole or ahead.

If you get your statement and �nd that you are tens of thousands of dollars in the hole, you

have two choices: The �rst is to accept that your gambling career is over and you will make

more money outside of the casino by not continuing to pour every dime you have into

trying to recover your losses (you will see why this is a fruitless exercise as soon as I get to

the math in this lesson.) If you can’t stop on your own, you should seek professional help.

The second choice is for action junkies that is, people that like to play more than anything

else. Since it is not really about the money you should switch to a �at betting format to

reduce the cost of your game play and save yourself some cash.

As a gambler, once you have determined your maximum lifetime bankroll, I recommend

visiting the credit o�ce and getting setup with a marker which you can use to play when

you are at the casino. This will be safer than bringing cash in and out of the casino. It will

also be cheaper than paying the ATM fees to get access to your money. If your credit isn’t

all that great or you just don’t want to go through all of the hassle of establishing a credit

account, the casino will let you set up a FOD (Funds On Deposit) account. You can put your

money in this account and then take some or all of it out during your gaming sessions. You

can also store your open marker and any winnings you have in this account. I think that

setting this up initially is the best way to go because while you can always get more money,

to fund these accounts, having them, can act as a �rewall between your other money that

you should not be spending in the casino. Therefore, if you blow through this money and

need to fund your accounts again it will be the �rst clear sign that you are probably on a

path that you don’t want to be on.

Let’s get down to business and talk about the math as it relates to your bankroll. If you will

recall from earlier, the casino has a 51% advantage which means that you are at a 49%

disadvantage. In terms of risk, this translates into the inverse expressed by the following

formula:

(Risk = Reward) - Edge (1%)

51% 49%

Risks and rewards are counter balanced that is, you cannot change one side without

a�ecting the other side of the equation.

Casino Advantage 51% Casino Risk 49%

player Disadvantage 49% players Risk 51%

In simple terms, you can always lose more than you can win. This a�ects the size of your

bankroll in the following way: You have to risk proportionally large amounts of money to

win less. Let’s start with the underlying function for calculating this risk.

(Chance of Losing Bankroll / Bankroll + What I would Like to Win) = Chance of Success

Subtract your chance of success from 100 and the result will be the chance you will lose

the amount of money you are putting at risk �rst.

In a simple 50/50 game with no house edge your chance of winning $10 before losing $10

can be calculated like so:

$10 / $20 = 50%

So there is a 50% chance that you will lose $10 before you can win $10. You can increase

the con�dence of this win by putting more money at risk. The following table shows

several examples of this:

Bankroll Size Win Target Chance I will meet Win Target First

Chance I will Lose my Bankroll First

$10 $10 50% 50%

$20 $10 66% 34%

$30 $10 75% 25%

$40 $10 80% 20%

$50 $10 83% 17%

$60 $10 85% 15%

$70 $10 87% 13%

$80 $10 88% 12%

$100 $10 90% 10%

$200 $10 95% 5%

$500 $10 98% 2%

$1000 $10 99% 1%

When you add the casino edge to the calculations the numbers get a little worse.

($10 / $20) - edge( 1%) = 49% (51% chance you will lose �rst)

To break even the calculation would be this: ($10.50 / $20.00) = 52%

(48% chance you will lose �rst)

To pro�t the calculation, would be this: ($11 / $20) = 55%

(45% chance you will lose �rst.)

In addition, there are at least three other critical factors that a�ect the size and

e�ectiveness of your bankroll and they are:

1. Win Target

2. Number of Hands Played

3. Bet Size

For example, the higher your win target relative to your bankroll the less likely you are to

reach that win target with multiple bets. Let’s look at several common “buy- ins” which I

will assume are bankrolls or session bankrolls. I will also assume that most people are

going for broke trying to win as much money as they can. Which brings us back to the

Maximum Boldness Theory and the math behind it. Basically, your best chance to double

your money comes from placing a single wager because the more you string out the bets,

the more you multiply the possible outcomes and therefore your percentage of success

starts to drop o�.

The equation of this is:

(49% / the number of bets ) = Percentage of Success of doubling your bankroll. The inverse

percentage represents your chance of failure that is, losing your bankroll before you can

score a win. The formula for calculating this is (100% - (49% / the numbers of bets ) =

Percentage of Failure). For an example of this concept, let’s say we have a player that

starts with a $300 bankroll and would like to double it. Notice, how his chance of success

falls o� as he decreases his bet size and makes more bets.

Bankroll Bets Bet Size Chance of Success

Chance of Failure

$300.00 1 $300 49% 51%

2 $150 24% 76%

3 $100 16% 84%

4 $75.00 12% 88%

5 $60.00 9% 91%

6 $50.00 8% 92%

10 $10.00 1% 99%

Another mathematical function of the game is Standard Deviation that is, the amount

above or below a speci�c outcome and I don’t think that most gamblers can appreciate

when this is working in their favor, but everyone recognizes when it is not. When Standard

Deviation works in your favor it would be the one and rare instance in which you will be

able to win $300 by placing $10 bets and when it works against you, you will lose even

though you have done everything correctly. The following table shows a list of common

“buy- ins” along with the corresponding con�dence levels of reaching a speci�ed win

target. Learn to recognize when you have won and quit! It is a fact that 99% of gamblers

are ahead at some point during a gambling session, but most don’t recognize it. Keep this

in mind as you review the following table, the higher the amount of money you are trying

to win, greater is the probability you will lose your money �rst. The table below shows

your chance of success, the inverse (not shown) is the risk you will lose �rst.

Win Target

Bankroll $300

Bankroll $500

Bankroll $1000

Bankroll $1500

Bankroll $2000

Bankroll $5000

Bankroll $10000

$10 96% 98% 99% 99% 99% 99% 99%

$20 93% 96% 98% 98% 99% 99% 99%

$30 90% 94% 97% 98% 98% 99% 99%

$40 88% 92% 96% 97% 98% 99% 99%

$50 85% 90% 95% 96% 97% 99% 99%

$60 83% 89% 94% 96% 97% 98% 99%

$70 81% 87% 93% 95% 96% 98% 99%

$80 78% 86% 92% 94% 96% 98% 99%

$90 76% 84% 91% 94% 95% 98% 99%

$100 75% 83% 90% 93% 95% 98% 99%

$150 66% 76% 86% 90% 93% 97% 99%

$200 60% 71% 83% 86% 90% 96% 98%

$300 50% 62% 76% 83% 86% 94% 97%

$600 33% 45% 62% 71% 76% 89% 94%

$1000 23% 33% 50% 60% 66% 83% 90%

The following table is provided for those who might be $10,000 or more in the hole. Keep

in mind that you are facing a 51% chance that you will only add to your de�cit if you are

chasing losses.(something you should never do.) For example, you would need a $100,000

bankroll for a 99% chance to regain $3000 without going broke �rst.

Win Target

Bankroll $300

Bankroll $500

Bankroll $1000

Bankroll $1500

Bankroll $2000

Bankroll $5000

Bankroll $10000

$3000 9% 14% 25% 33% 40% 62% 76%

$5000 5% 9% 16% 23% 28% 50% 66%

$10000 2% 4% 9% 13% 16% 33% 50%

$20000 1% 2% 4% 6% 9% 20% 33%

$50000 0% 0% 1% 2% 3% 9% 16%

$80000 0% 0% 1% 1% 2% 5% 11%

$100000 0% 0% 0% 1% 1% 4% 9%

$200000 0% 0% 0% 0% 0% 2% 4%

One last table before we move along, this table is for the people who have buy- ins of less

than $300.00

Win Target Bankroll $50

Bankroll $100

Bankroll $150

Bankroll $200

Bankroll $250

$10 83% 90% 93% 95% 96%

$20 71% 83% 88% 90% 92%

$30 62% 76% 83% 86% 89%

$40 55% 71% 78% 83% 86%

$50 50% 66% 75% 80% 83%

$60 45% 62% 71% 76% 80%

$70 41% 58% 68% 74% 78%

$80 38% 55% 65% 71% 75%

$90 35% 52% 62% 68% 73%

$100 33% 50% 60% 66% 71%

So far, I have covered the importance of establishing a lifetime gambling bankroll, and I

have talked a little bit about bankroll sizing and the risks associated with gambling and how

to calculate those risks. The last relationship we need to examine to complete our

discussion is that of Bet to Bankroll Ratios. This should be a pretty straightforward

concept however, when I’ve watched people play at the tables, their bet selections

appear to be largely random and mostly based on some con�dence level they place on a

particular hand. For example, if they think they will lose the bet, they bet small, if they like

the bet, they bet big. If they are chasing losses they are betting big. It should come as no

surprise that the size of your bets has a signi�cant impact on the number of chances you

can make in search of a win before all of your money is gone.

The smaller the bets, the longer your bankroll survives a losing streak. The bigger the

bets, the sooner you run out of money.

Regarding Betting Systems or (methods as I like to call them) are nothing more than a

series of rules which dictate how one should bet based on a given condition. Betting

systems do not change the underlying mathematics of the game, but they do signi�cantly

alter the player’s experience, we will look at how this works shortly, but �rst, let’s master

the concept of units. Units is a way of dividing a bankroll. Generally, there is a one to one

ratio between the table minimum and the unit value. Therefore, if the table minimum is

$10 then a unit is $10 The following table takes various di�erent bankrolls and breaks

them into units.

$10 = 1 Unit

Dollars Units

$50 5

$100 10

$150 15

$200 20

$250 25

$300 30

$500 50

$1000 100

$1500 150

$2000 200

$5000 500

$10000 1000

Betting systems (or methods as I like to call them) generally fall into a couple of categories,

that is, additive or multiplicative. Additive systems, typically add or subtract units whereas

multiplicative systems, multiply units. The most famous and e�ective multiplicative system

is the Martingale and the anti-Martingale. Betting systems are essentially trade o�s

between either small frequent wins and occasional big losses, or small frequent losses

and occasional big wins. I will summarize these concepts in the following table.

Betting Systems Description

Flat Always bet the same amount

Press on Win Bet more after you win

Press on Loss Bet more if you lose

Press if Ahead Bet more if you are up

Press if behind Bet more if you are down.

Betting systems are either positive or negative. Positive systems increase bets when

winning and negative systems increase bets when losing. In order to appreciate how

betting systems alter the player’s experience without impacting the underlying

mathematics, I will present several examples that illustrate this. Because Baccarat is a

game that requires zero skill to play, I have not committed any time to talking about things

one might do to win. Instead I’ve focused on concepts related to the mathematics of the

game and its relationship to your money which is the only thing that matters at the end of

the day. In that spirit, Baccarat is nothing more than a series of Win/Loss patterns or hits or

misses. When you miss, the money goes one way, from you to the dealers tray. When you

hit, your money comes back to you along with an equal amount of money from the dealers

tray. In fact, when you think about it, the game is much like a slot machine where the

jackpot is determined by the amount of money you put in. If you win, you will get your

money back plus the jackpot amount. If you lose, your money is gone. When you feed

more money into the machine (or game), you are playing an entirely di�erent game from

the one you just played, and one that is going to be di�erent from the one you are going to

play next, this concept is known as the the law of independent events. Therefore, there is

no relationship between one hand to the next.

For our examples we will use W to equal Win and L to equal Loss. We will represent the

money applied to the game in terms of units and �nally, we will show the bust points

(when you go broke) of various bankrolls based on the betting system used. To keep

everything as simple as possible but also comprehensive, we will take 20 hands which

represents one quarter of a shoe and we will construct 8 di�erent patterns and then

show how various betting systems perform under the same conditions or (underlying

mathematics.)

Our test shoes will consist of the following patterns.

1. All Losses

2. All Wins

3. Losses Followed by Wins

4. Wins Followed by Losses

5. Wins Surrounded by Losses

6. Losses Surrounded by Wins

7. Wins and Losses Evenly distributed

8. Clustered Wins and Losses

For betting progressions we will test the following systems:

1. Flat betting

2. Martingale (negative progression, multiplicative)

3. Anti-Martingale (positive progression, multiplicative)

4. D'Alembert (both positive/negative or pyramid, additive)

5. Parlay (positive, multiplicative / additive)

6. Paroli (positive, multiplicative / additive)

7. 1-3-2-6 (additive, tight-spread progression)

8. U1D2M2 (additive, variation of D’Alembert)

All betting systems have strengths and weaknesses and the randomness of the game can

expose you to both. However, it is better to �nd out what those weaknesses are before

you put real money on the line. In our examples, there will be 12 players at the table each

with starting bankrolls represented by the table below.

Starting Bankrolls

Dollars Units

(player 1) $50 5

(player 2) $100 10

(player 3) $150 15

(player 4) $200 20

(player 5) $250 25

(player 6) $300 30

(player 7) $500 50

(player 8) $1000 100

(player 9) $1500 150

(player 10) $2000 200

(player 11) $5000 500

(player 12) $10000 1000

System: Flat Bet

Rules: Always bet 1 unit

Pattern #1 All Losses

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

L L L L L L L L L L L L L L L L L L L L

1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1

B B B B

Results of Shoe #1 All Losses

player No Result

1 Goes broke at hand 5




5 Losses 75% of bankroll








The above chart shows several things �rst, all players lost $200 which is a table hold of

$2,400 this is a function of the underlying mathematics. Second, the size of your initial

bankroll determines your ability to survive downswings or losing streaks. The higher your

bankroll, the smaller the hit you take. However, this can be a double-edge sword,

precisely because you have a higher bankroll, you are more likely to bet against an adverse

condition longer than someone who can’t a�ord to and 89% of the time it will work out.

But roughly 11% of the time you will lose up to 3x as much. For example, if you were player

12 with a 1000 unit bankroll ($10,000) and you lost 60 hands in a row while this loss would

only represent 6% of your bankroll the dollar amount would be a loss of $600.00.

System: Flat Bet


Pattern #2 All Wins

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

W W W W W W W W W W W W W W W W W W W W

1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1

Results of Shoe #2 All Wins:

The outcome of this shoe is all players win $200. As a percentage of bankroll, players with

lower bankrolls do better (players 1-4). players 5-12 have gain percentages that mirror

their previous loss percentages. For example, in shoe #1 player 12 had a loss of 2% now

he had a gain of 2% so on and so forth.

Let’s move on to our next pattern, Losses followed by Wins.

System: Flat Bet


Pattern:#3 Losses Followed by Wins

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

L L L L L L L L L L W W W W W W W W W W

1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1

B B

Results of Shoe #3 Losses Followed by Wins

player No. Result

1 player goes broke at hand 5

2 player goes broke at hand 10

3 player wins $10 Drawdown (66%)










The drawdown in the results above show how low the bankrolls got before things turned

around. Let’s go to shoe number 4 Wins followed by Losses.

System: Flat Bet


Pattern:#4 Wins Followed by Losses

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

W W W W W W W W W W L L L L L L L L L L

1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1

In this scenario, none of our players go bust, but they all break even. This is because the

wins cushioned them from the losses and there were just enough losses to chew up the

winnings. Let’s continue on to our next pattern.

System: Flat Bet


Pattern:#5 Wins Surrounded by Losses

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

L L L L L W W W W W W W W W W L L L L L

1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1

B 0 5 0

In the above scenario, the player (1) with the lowest bankroll (5 units) goes bust at hand 5

everyone else breaks even at hand 10 by hand 15 all players are up 5 units but by hand 20 all

players have broke even. Our next pattern is the opposite of the previous one.

System: Flat Bet


Pattern:#6 Losses Surrounded by Wins

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

W W W W W L L L L L L L L L L W W W W W

1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1

5 0 B 0

In the above scenario all players are up by 5 units by hand 5 but by hand 10 they are all even,

by hand 15 the player with the smallest bankroll goes bust and by hand 20 the remaining

players break even. Let’s move on to our next pattern.

System: Flat bet


Pattern:#7 Wins and Losses Evenly Distributed

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

W L W L W L W L W L W L W L W L W L W L

1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1

The net result of the above sequence is that all players break even.

System: Flat bet


Pattern#8 Wins and Losses are Clustered

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

W W L L L L W W W W W L W W W L L L W L

1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1

0 0

The net result of the above sequence is that all players make $20. However, before I go

through what happens with the other bet progressions, now is a good time to talk about

another important concept and that is, the concept of Volatility. Baccarat is a game that is

full of volatility at every level. For instance; there is volatility from hand to hand, there is

volatility in every 10 to 20 hands of a game, there is volatility in every half game, that is,

every 40 of 80 hands and then there is volatility from game to game, from day to day and

from week to week and month to month. To help you understand this concept, I will

provide you with the following diagram so that you can see the concept visually, but

basically, volatility is a sine wave and when you play Baccarat you are riding the wave, or

playing against it. The casinos mathematical edge is on the center line (not shown in

diagram). Every time money crosses that line, they grab pennies. Therefore, you win

because money comes towards you, and you lose money when it is �owing in the opposite

direction.

Example of Volatility:

Just about every player of the game experiences volatility in terms of bankroll swings (

both up and down) that is, wins that turn into losses and losses that turn into wins. For

example, I have programs that let me graph the outcomes of shoes. I can also graph

betting progressions and when I overlay the betting progressions on top of the shoe

outcomes, I get graphs that change sometimes dramatically, this is because betting

progressions increase volatility. To understand this concept more fully let’s go back to an

elementary math concept of the number line for positive and negative integers. Pictured

below: When you win bets, the scale tips towards the positive end of the scale and when

you lose bets it tips towards the negative end of the scale. If your wins and losses are

equal you get zero. Betting systems attempt to in�uence this process by pushing you to

the right of zero as much as possible and then they might work to slow your slide back

down to zero. Negative progressions, attempt to slingshot you from left of zero to the

right of it. They do this by loading up the negative side of the scale with lots of money so

much so that once you get a win you are thrust back into positive territory. Both are valid

approaches if you have an endless amount of money, or when your win targets are small,

but play reckless, have an inadequate bankroll, a win target that is too high and the most

likely result is that you will go broke �rst.

Example of the Money Line In Baccarat

Now that you understand the concept of volatility lets move on to look at how bet

progressions increase volatility. We will pick up where we left o�. We have 12 players at

the table each with bankrolls that are represented by the following range in units [5, 10,

15, 20, 25, 30, 50, 100, 150, 200, 500, and 1000]. These players will play their progressions

across the same eight patterns we used when analyzing �at betting. Because I need to

write larger numbers into the �elds we will chop the result tables in half that is, I will

present 20 hands of game play as two sets of 10 instead of one set of 20. Otherwise,

everything else is the same.

System: Martingale

Rules: Always bet 1 unit, Double on Loss

Pattern:#1 All Losses

1 2 3 4 5 6 7 8 9 10

L L L L L L L L L L

1 2 4 8 16 32 64 128 256 489

B B B B B B B B

11 12 13 14 15 16 17 18 19 20

1 2 3 4 5 6 7 8 9 10

L L L L L L L L L L

11 12 13 14 15 16 17 18 19 20

Results of Shoe #1 All Losses Using Martingale Betting System

player No. Result













As you can see from the results above the Martingales biggest strength (a single win

recovers all past losses, plus adds a pro�t of 1 unit) is also its biggest weakness. This is

because consecutive losing streaks will cause steep and dramatic bankroll drawdowns.

player psychology also plays a major role. For example, it is easy to look at the shoe after

the fact and say well it is stupid to bet against a streak but this is hindsight bias, (see lesson

3) as losing streaks can come in many forms including guessing the wrong outcomes in a

neutral shoe, or jumping from table to table and missing several bets in a row. The more

bets you miss the more your con�dence goes down both mathematically and

psychologically. The table hold for 12 gamblers busting playing the Martingale is

$21,050.00 which is the combined bankroll of all of our players.

Let’s continue our analysis of the system by having our players to play it against other

patterns.

System: Martingale


Pattern:#2 All Wins

1 2 3 4 5 6 7 8 9 10

W W W W W W W W W W

1 1 1 1 1 1 1 1 1 1

11 12 13 14 15 16 17 18 19 20

W W W W W W W W W W

1 1 1 1 1 1 1 1 1 1

The net result of shoe #2 all of our players win $200.

System: Martingale


Pattern:#3 Losses Followed By Wins

1 2 3 4 5 6 7 8 9 10

L L L L L L L L L L

1 2 4 8 16 32 64 128 256 489

11 12 13 14 15 16 17 18 19 20

W W W W W W W W W W

In the above scenario all of our players go broke before they can achieve a win. Let’s move

on to our next pattern which is Wins followed by Losses.

System: Martingale


Pattern:#4 Wins Followed by Losses

1 2 3 4 5 6 7 8 9 10

W W W W W W W W W W

1 1 1 1 1 1 1 1 1 1

11 12 13 14 15 16 17 18 19 20

L L L L L L L L L L

1 2 4 8 16 32 64 128 256 512

B B B B B B B

Results of Shoe #4 Wins Followed by Losses

player No. Result













In the above scenario the winning streak only added 10 units to each players starting

bankroll. It took only four losing bets to give up these gains and after that, all players went

broke.

System: Martingale


Pattern:#5 Wins Surrounded by Losses

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 4 8 16 32 1 1 1 1 1 1 1 1 1 1 2 4 8 16

B B B B

Results of Shoe #5 Wins Surrounded by Losses Using Martingale Betting System

player No. Result






6 Goes broke at hand 20 *

7 Loss of 20 units

8 Loss of 20 units

9 Loss of 20 units

10 Loss of 20 units

11 Loss of 20 units

12 Loss of 20 units

* player 6 started with a bankroll of 50 units but by hand 6 he only had enough money left

to bet 19 units and not the required 32 units the Martingale requires so he goes for it and

makes an all in bet which he wins. His total bankroll now stands at 18 units. He picks up

another 10 units from the winning streak to bring his total to 28 units, but then he �nally

goes broke at hand 20. The rest of our players players 7-12 have big enough bankrolls to

make the required bets and survive the downswings. The game ends with them all taking

a 20 unit loss.

Now let’s look at what happens when the losses are surrounded by wins

System: Martingale


Pattern:#6 Losses surrounded by Wins

1 2 3 4 5 6 7 8 9 10

W W W W W L L L L L

1 1 1 1 1 1 2 4 8 16

B B

11 12 13 14 15 16 17 18 19 20

L L L L L W W W W W

32 64 128 256 512

B B B B B

Shoe #6 Losses Surrounded by Wins Martingale

player No. Result













.

System: Martingale


Pattern:#7 Wins and Losses evenly distributed

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 1 2 1 2 1 2 1 2 1 2 1 2 1 2 1 2 1 2 1

In the above scenario, each of our players �nished ahead by 9 units or $90.00 Let’s move on

to our �nal pattern of Wins and Losses Clustered.

System: Martingale


Pattern:#8 Wins and Losses Clustered

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 1 1 2 4 8 16 1 1 1 1 1 2 1 1 1 2 4 8 1

B B

Analysis of shoe #8 Wins and Losses Clustered using the Martingale. The previous shoes

(1-6) all showed level of volatility that lasted over several hands that is, 5-10 hands. Shoe

#7 showed very high volatility (consistently choppy shoe) where the volatility can be

represented by a zigzag pattern. However, shoe number #8 contains volatility that is of

varying lengths. The vast majority of the shoes players encounter will be of this type. It will

be much clearer to explain what happens by using a combination of narrative and

underlying math to walk you through what happens to each player's bankroll as a result of

the aforementioned shoe. First, lets walk through the underlying mathematics based on

our bet selection use the table above as a reference:

1. We win our �rst two hands and pick up 2 units

2. We encounter a losing streak that lasts for 4 hands and we win on the 5th hand.

3. We encounter another winning streak that last for three hands.

4. This is followed by a Win/Loss which cancel each other out for a net gain of zero

5. We encounter another winning streak of 3 hands which allows us to pick up 3 units.

6. This is followed by a losing streak that last for 3 hands we win at hand 19 only to lose at

hand 20.

The math looks like this:

SBR = Starting Bankroll

( ) = we had to remove from our bankroll to bet but we won.

SBR +2 [ -1 -2 -4 -8 (-16) = -31 + 32] + 3 + 3 [+1 + -1] = 0 + [-1 -2 -4 - (8) -15 + 16]

-1. The net result of this string of numbers is that each player either goes broke, su�ers a

net loss or win $90.00.

Session Analysis for player #1

1. Starting bankroll is 5 units.

2. Wins 2 hands bankroll is now 7 units

3. Bet 1 unit and loses (hand 3) bankroll is now 6 units

4. Bet 2 units and loses (hand 4) bankroll is now 4 units

5. Bet 4 units and loses player goes broke at hand 5


1. Starting bankroll is 10 units



4. Bet 2 units and loses (hand 4) bankroll is now 9 unites


6. Bet 5 units and loses (hand 6) required bet was 8 units (player goes broke)







6. Bet 8 units and loses (hand 6) bankroll is now 2 units.

7. Bet 2 units and wins (hand 7) required bet was 16 units bankroll is now 4 units

8. Wins a total of 6 units by (hand 15) bankroll is now bankroll is now 10 units




12. bet 3 units and wins (hand 19) required bet was 8 bankroll is now 6 units.

13. Bet 1 unit and loses (hand 20) bankroll is now 5 units. (lost 66% of bankroll)








7. Bet 7 units and wins (hand 7) required bet was 16 bankroll is now 14 units

8. Wins a total of 6 units by (hand 15) bankroll is now 20 units




12. Bet 8 units and wins (hand 19) bankroll is now 21 units.

13. Bet 1 unit and loses (hand 20) bankroll is 20 units (player breaks even.)








7. Bet 12 units and and wins (hand 7) required bet was 16 bankroll is now 24 units




11. Bet 4 units and loses (hand 18 ) bankroll is now 23 units

12. Bet 8 units and wins (hand 19) bankroll is now 31 units

13 Bet 1 unit and lose (hand 20) bankroll is now 30 units (player shows 20% pro�t)



2. Wins 2 hands bankroll is now 32 units.










12. Bet 8 units and wins (hand 19) bankroll is now 39 units (player shows a 24% pro�t)

The rest of our players (7-12) will show results similar to player #6 as they all have big

enough bankrolls to make all of the required bets. However, their percentage gained will

drop o� relative to the size of their starting bankrolls. I know that I hit you with a lot of

math in this lesson, but I wanted to illustrate how volatility, bankroll size and bet selection

in�uence a player's experience at the table. As you can see from the examples I have

presented so far, while all of our players, played the same tables and made basically the

same betting decisions their outcomes varied some in large part due to bankroll

limitations. I also wanted to show that bet selection doesn’t a�ect the underlying

mathematics of the game. We did this by looking at two di�erent betting progressions

(�at betting and the Martingale). I will review the other betting selections in a di�erent

section of the book but I would like to wrap up this lesson by giving you a visual

representation of the volatility present in the shoes I have used as a basis for my tests in all

of the aforementioned examples. I should also mention, that I will use these same shoes

for testing the other betting systems I listed earlier.

Shoe #1 and Shoe #2 were two shoes that were constructed from volatility that had a

duration of 20 hands. The following diagram visually represents the �rst two test shoes.

The next shoe (Shoe 3) describe as Losses followed by wins where the volatility lasted

exactly 10 hands is depicted in the following diagram:

Shoe #4 Wins followed by losses in which the volatility lasts for 10 hands is depicted in the

following diagram:

The next diagram depicts shoe #5 Wins Surrounded by Losses in which the duration of the

losses were for 5 hands and the duration of wins were for 10 hands:

Shoe #6 Losses Surround by Wins is just the opposite and is depicted below:

Our next shoe is shoe #7 which exhibits very high volatility (choppy) described as wins and

losses evenly distributed. This is pictured below:

Shoe #8 Is a shoe that consists of variable length volatility that is, where the wins and

losses are of di�ering lengths such as; 2 wins, 4 losses, 5 wins, 1 loss , 3 wins, 3 losses, 1 win

and 1 loss etc. Volatility for shoe #8 is pictured below:

In this lesson you learned a lot about the underlying mathematics of the game and the

concept of volatility. You learned what it means to put your money at risk and how to

calculate those risks. You learned that betting progressions don’t change the underlying

mathematics of the game but they do signi�cantly alter the players experience of the

game. You learned the importance of having a properly sized bankroll to support your

method of play and to survive the associated down swings.

Chapter 6

Game Characteristics

“Those who cannot remember the past are condemned to repeat it.” - George Santayana

In this section I want to focus on a few concepts, the �rst one is what you should be paying

attention to when playing Baccarat. A lot of players spend time tracking hands and card

counts but you already know that much of this is a waste of time especially if doing so is in

anyway related to determining what the next hand is going to be, as no one can see

around corners. However, what you should do is set up a card and keep copies of the

shoes you encounter in the casino. You should keep these cards for your records. These

cards can be used for several useful purposes such as;

1. To serve as a record of the volatility of the shoes you encounter.

2. You can use them to test betting strategies and approaches (both tactile and logical

execution) Let me explain tactile and logical execution, tactile execution would involve

you practicing with actual chips your betting strategy whereas, logical execution means to

practice your betting strategy on paper using simple arithmetics.

Some may think that this is a waste of time, but I can assure you that it is not and you will

see why soon. Besides, you need something to do while you are sitting at the table for 2

hours other than to watch the hands come out. Eventually, you won’t care (how) you win

or lose, but rather, what that win or loss means to your money and what you are going to

do next.

This brings us to the second thing you should be tracking when playing the game, and that

is your money. The �ow of your money (I will show you how to plot this). Provides many

clues about the volatility of the game you are playing (refer to the graphs at the end of the

last section). For instance, if you are playing and the overall trend is that you are winning

despite a few losing hands then the volatility is positive and you can expect this to be

followed by negative volatility. Conversely, if you are playing and the overall trend is you

are losing, despite winning a few hands then, the volatility is negative and you can expect

this to be followed by positive volatility. This is the only thing you can place any real

con�dence in, however, here is where it gets tricky, you will never be able to determine

how many hands you will have to wait for this to happen and your ability to survive this

downswing of unknown duration will largely be a function of your bankroll size, your

betting spread and the method you are using to reach your win goal. Finally, you will learn

that it is not what happens as much as how.

Lesson 6

Understanding the Game Characteristics “In Baccarat, it is not about what happens, but how.” -- Lee Evans

The �rst concept we want to cover is game boundaries, game boundaries is just another

way of saying what de�nes a game, how many hands. For Baccarat it is 80 hands and it

takes about two hours to play a game. I call anything more than a few hands a long game.

Therefore, a short game is 5 or less hands. Most people sitting at the tables that are

standing and betting for long periods of time are playing a long game. The big betting

table jumpers are playing a short game (at least they are when they place 1-2 bets at a

table). They are playing a long game too, but some of them don’t realize it. Most of the big

betting table jumpers are playing one of two systems 1) The Martingale (double on loss) or

2) the Anti-Martingale (double on win). I just want you to understand what you are seeing

when you see these guys walk up to the table and place a $2,000 bet and then disappear

for a while.

Back to game boundaries and how to record them, I have tried many di�erent card layouts

but the most e�cient layout is to break the 80 hand game into 4 quarters of 20 hands

each. This will give you a good overall view of the volatility and any skews created by the

tie hands. The casino provides cards that are on graph paper and you should set your cards

by orienting them the long way and then starting from the left �ll in the top row of boxes 1

through 20, skip two lines this will take you to row 4 and write in 1 through 20 again, skip

two lines, this will take you to row 7 and write in 1 through 20 gain. This represents the

�rst three quarters of the game (60 hands) for the last 20 hands of the game, start at row

one and write 1 through 10 in the remaining space and then skip to row 4 and write 11-20.

You should date this card and label it with the shoe number. For example, if this is your

�rst shoe you should call the card Shoe #1 so on and so forth. You are going to use this

card to make a permanent record of the tote board. The numbers that you wrote on the

card are the hand numbers. The �rst blank line right under the numbers is for the banker

events, every time the banker wins a hand you should put an “X”. The next line is for the

player events, every time the player wins a hand you should put an “X”. If there are ties,

you should draw a vertical line through both the banker and the player lines. Below is an

example of what a complete card looks like (this card represents a real shoe I played at the

Rivers Casino in Des Plaines, Illinois). The grid is 20 wide by 12 long. Most of the time the

yellow card indicating one more hand until the end of the shoe, should come out at hand

19 in the fourth quarter of the game (really hand 79). If the game is going to end early, this

card may come out after hand 15 in the fourth quarter (hand 75). In some instances, the

game will be a little longer than 80 hands and you can use any free space left on the card

to record the over�ow.

Baccarat Game Boundaries (Rivers S5 01/XX/2011)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

X X X | X X X X X X

X X X X X | X X X X X

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

X X X X X X X X X X

X X X X X X X X X X

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

| X X X X X X | X

| X X X X X X X X X X | X

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

X | X X X X X X X X X

X X X X X | X X X X

Remember, the above card captures the outcome of the game and nothing else.

However, once you impose order on this randomness, several characteristics emerge

such as:

1. Event Distribution (how the game is balanced between banker and player events).

2. Volatility (the frequency of shifts between banker and player events.)

3. The overall characteristic of the shoe that is, choppy, streaky, neutral, player dominant,

banker dominant.

Let’s look at each one in turn starting with Event Distribution. We measure Event

Distribution at every quarter of the game by tallying the total banker events vs the total

player events. Finally, we tally the totals for the entire game like so:

Quarter banker player

1 9 10

2 10 10

3 7 11

4 10 9

Total 36 40

The above table tells us several things about the shoe for instance, in the �rst quarter of

the game player beat banker by one point. This was due to a tie at hand 9 I will talk about

how ties skew the results shortly and how you can use this information to make educated

guesses. In the second quarter of the game, banker and player events were balanced. In

the third quarter of the game player beat banker by 4 points, where two of these were

due to ties at hands (1 and 18). Finally, in the fourth quarter of the game, banker beat

player by one point. The net result is player wins by 4 points.

Let’s talk about ties, ties skew the game by putting one hand (banker or player ) at a

disadvantage while giving the other hand an advantage. You can usually tell which by the

following, If the tie is putting you at a disadvantage, then you will push on a hand you

needed to win. If the tie is providing you with an advantage, then you will push on a hand

instead of losing. In lopsided shoes, banker dominant or player dominate shoes the tie

counts consistently against one of the sides. In neutral shoes, it will switch between the

sides.

The following is an assertion that is made from observation which may or may not be

supported by the mathematics. Ties can provide you with clues about the shift in volatility if

you can read them correctly. If you will recall from our previous lessons what players call

luck is really volatility and some players don’t like to play after a tie because they think that

ties “mess up the shoe” while there is a lot of superstition in gambling, I think that the

players are onto something when it comes to ties. Here’s my assertion, shoes would

largely come out even if there were no ties that is, the endgame Event Distribution would

show scores like 40 bankers to 40 players or 35 bankers to 35 players etc. Shoes can still

show these scores if the distribution of ties is equitable that is, that they amount to an

even number or an odd number that is small enough to not take away events from either

player or banker to cause the shoe to be lopsided. However, most of the time, ties skew

the results as the vast majority of shoes contain at least 7 or 8 ties. Let me draw a mental

picture of this, Let’s say we have tube and we can �t exactly 80 marbles into this tube, we

have 40 red marbles and we have 40 green marbles and 15 blue marbles. Our red marbles

will represent the player hands, our green marbles are for the banker hand and our blue

marbles are for the ties.

So we start to �ll our tube like so:

Slot Number Marbles

1 Red

2 Green

3 Green

4 Red

5 Blue

6 Blue

7 Blue

8 Blue

9 Blue

10 Red

11 Green

12 Green

13 Blue

14 Blue

15 Green

16 Green

17 Blue

18 Blue

19 Blue

When we tally the results we get:

6 Green (bankers) to 3 Red (players) to 10 Blue (Ties) You can see a couple of things here

�rst of which the player hands are being disadvantaged by the ties. So when you look at

the tote board when playing Baccarat and you see:

banker 6 Ties 10 and player 3 Gamblers will start betting that the player will catch up. This

is a logical assumption. However, it is very rare (but not impossible for one side to have a

higher number when starting only to be outpaced by the other side during the game) but

what usually happens as you will see when playing, is that once one side has the lead, the

side that is ahead usually stays ahead by a �xed ratio for the duration of the game. In other

words, if you add the ties to the lower of the two numbers on the tote board, (in our

example to the player hands) then you get player 13 banker 6 so it is the banker that is

going to go on the run to catch up to the players number + the ties. Once you can establish

the �xed ratio that is being maintained, it will seem like magic that you know exactly where

to place your money and when. In essence, what you are really doing, is riding the

underlying wave of volatility. For example, let’s say a shoe starts out: BPBBBPBBPBBB and

the tote board shows banker 10 player 3 (a point di�erence of 7) let’s say that you know

that 7 is the point ratio between the two hands, you also know at this point that the banker

pulls ahead �rst and then the player follows. The ratio is important because as long as the

ratio holds, the hand that is behind will not advance beyond this point di�erence before

the other side moves to maintain its lead. The simplest way I can describe this bit of

pseudoscience is to say that it is like watching stop and go tra�c where some random car

is de�ned as my reference point for leader, the cars in between are the ratio and the car at

the end of the chain is my reference point for follower. But therein lies the rub, you are

ultimately forced back into a binary decision of matching the unfolding of hands in groups

and when you are correct, people will think that you are some kind of Baccarat master but

when you are wrong, you can end up on the opposite side of things and people will start to

bet against you because you are “unlucky.”

Getting back to our card, the next thing you will see is a literal graph of the volatility

between hands. For example, We know that the top row of our card contains the hand

numbers and the �rst line under the hand numbers is the banker line and the line below

that is the player line. If you use the line that is separating the banker events from the

player events as your reference point of zero you will see a graph of the volatility that is,

the transition of events above or below the center line. You will notice that your “X” are

snaking over that center line. Here’s a section of our card for reference. Can you see the

graph created by the “X”?

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

X X X X X X X X X X

X X X X X X X X X X

Finally, our card provides a lot of information about event groupings. That is, a lot of

Baccarat players are pattern players. For example, in the section of the shoe above there

are 7 chops at the following hands [1, 2, 6, 10, 14, 17 and 18]. Other players like to play

streaks, there are 5 streaks in the above section at the following hands [3, 7, 11, 15 and 19].

Other players like to play doubles there are 8 doubles at hands [3, 5, 7, 9 11, 13, 15 and 19].

These various di�erent grouping of events make up the overall characteristics of a shoe

and any serious player in my opinion should maintain a record of the shoes played or

observed and then analyze those shoes for the count, duration and variance in english

(how many, how long and how far apart) the desired events appear in the shoes a player

has been exposed to and then use this information to de�ne and select a money

management plant to capitalize on the most common occurrences. Because you can only

place a 49% con�dence in any outcome and you cannot see around the corner, you also

need a contingency plan for dealing with unforeseen circumstances because nothing kills

a player faster at the table than when they encounter a situation that forces them to make

a decision that they haven’t thought through how they would address it. This brings us to

the subject of Hit Ratios. If you are using any kind of bet placement system whether a

pattern play or just based on a feeling you get inside, you should be tracking your hits. You

can do this by circling the “Xs” on your card.

Now let’s talk about the 2nd card you are going to be using during your game play, that is,

your money card. Just like a bean counter you should be tracking the �ow of your money.

and like a tide, it will be going out and coming back in during the course of the game.by

tracking these numbers, you will be able to monitor the rate and �ow money between you

and the dealers tray. You will also be able to see the volatility here as it should track

closely with your game performance. For example, if you have a cluster of wins most of

your numbers will be positive. on the other hand if you have a series of losses then the

numbers will be non-positive. Setting up your money management card is similar to

setting up your card for tracking the tote board with one major exception that is, you only

need one blank line between the hand numbers you write on your card therefore, you

should be able to get all of your hands to �t on the card without using the space in the

upper right corner of the card. If you lose a bet, you will mark the number of units you loss

for example, if you bet $10 and loss put a 1, If you bet $50 and lose put a 5 etc. On the other

hand, if you win $10 put +1 and if you win $50 put +5. Below is an example of a blank money

management card.

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

Below is a sample(only 10 hands) of a money management card that is �lled out.

1 2 3 4 5 6 7 8 9 10

1 1 1 +2 +4 +1 +2 1 1 1

Let me explain what you are seeing when you look at the above sample money

management card, �rst, you are seeing the number of units I bet at each hand. Then, you

can see which hands I won and which ones I lost. Finally, you can see the volatility (wins

surrounded by losses). For example, I lost the �rst three hands for a total of $30 then I win

the next four hands for a total of $90 then I lose the next three hands for a total of $30. At

the end of a series or a quarter which is 20 hands (not shown in this example) you add up all

of your wins and all of your losses and then subtract your losses from your wins whatever

remains is the amount of money you are up or down. Using the above sample as an

example, (amounts are expressed in units)

Total Wins: 9

Total Losses: 6

9 - 6 = 3 (I won $30) You can also quit after a series of wins for example, after winning

hands 4-7 (I might have a rule that says that I will quit on my next loss) that happens at hand

8, so that is my signal to stop playing now my totals are this:

Total Wins: 9

Total Losses:4

9 - 4 = 5 (I won $50)

These are the only two cards you will need at the table. You can pitch the money

management card at the end of the game, because you can always create a new one. But

remember to keep the card containing the outcomes of the shoe (copy of the tote board)

because you will use these for purposes I am going to get to shortly.

Finally, I would like to present you with two shoes which represent every possible outcome

in Baccarat. Each shoe is composed of 16 blocks of 5 outcomes grouped from worse to

best. Every shoe is a random combination of these master patterns. I ignore ties because

ties only skew the results in that they are non-actionable events when you are playing the

game head-to-head that is, it only matters if you win or lose a hand as pushes only advance

you through the game. To create the win/loss patterns line bet the player line through

both shoes. I use these shoes to stress test betting systems which is going to be my next

topic. I can test their balance that is, how much money you lose when you lose vs how

much money you can win when you win. Therefore these two shoes and the resulting

win/loss patterns will serve as essential tools in the development of a betting method that

is appropriate for you in terms of your bankroll size and action requirements.

Master Shoe #1 Blocks 1 - Blocks 16

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

X X X X X X X X X X X X X X X X X

X X X

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

X X X X X X X X X X X X X X

X X X X X X

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

X X X X X X X X X X X X

X X X X X X X X

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


X X X X X X X X

Master Shoe #2 Blocks 17 - Blocks 32

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

X X X X X X X X


1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

X X X X X X X X


1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

X X X X X X

X X X X X X X X X X X X X X

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

X X X

X X X X X X X X X X X X X X X X X

Here are the resulting win/loss patterns for the above shoes, you can use the same card

layout to plot win/loss patterns as you use for money management.

Plot of Win/Loss Patterns from Master Shoe #1

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

L L L L L L L L L W L L L W L L L W L L

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

L W L L L W L L L L L L L W W L L W W L

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

L W W L L W W L L L W L L L W W L L W L

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

W L W L L L W L L W L L W L W L W L W L

Here’s a tally of the characteristics to the �rst shoe:

Quarter 1: Wins = 3 (15%) Losses = 17 (85%)




Total Wins = 25 (31%)

Total Losses = 55 (68%)

Plot of Win/Loss Patterns from Master Shoe #2

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

L L W W W L W W W L W W W L L L W L W W

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

W L W W L W W L W L L W W W W W W W W L

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

W W W L W W W L W W W L W W W W W W W L

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

W W W L W W W L W W W L W W W W W W W W

Here’s a tally of the characteristics of the second shoe:





Total Wins = 59 (73%)

Total Losses = 21 (26%)

Every shoe in Baccarat is a made up of the 32 to blocks I’ve chained together in master

shoe #1 and master shoe #2. Those �ve hand blocks are just put together in di�erent

orders. Sometimes, the same blocks are chained together or repeat themselves multiple

times in a shoe. This is what makes the game so familiar, but at the same time, so elusive.

When players have high exposure to the game, they see the same patterns so often that

they begin to believe that they know what is going to happen next and sometimes they are

right, but most of the time they are wrong and this is usually because you can never tell

(when) something is going to happen (exactly), so as long as there is an element of

uncertainty all of your e�orts will be reduced to simply guessing. Therefore, players

should never become convinced of their own greatness. Proceed cautiously because the

game is tricky. For example, there are 16 blocks out of 32 (50%) that start with banker

winning the �rst hand. There are players that believe that banker wins the �rst hand 80%

of the time. The only thing that is absolutely true about Baccarat is that for long term

success, always bet the bank as the number of banker events over time will always

outpace the player events. This doesn’t mean that you won’t encounter player dominant

shoes and you won’t feel that great betting banker in a shoe that ends with player going 50

over banker 25. In Baccarat anything is subject to happen at any time that’s why you have

to be prepared.

Lesson 7

Appreciate the Value of Practice

I highly recommend that players of Baccarat practice outside of live game play. It has many

bene�ts such as; allowing you to enjoy the up and downs of the game without the

pressures of putting real money on the line; Let’s try di�erent approaches in much less

time than it would take doing it in a live environment. All of this practice will help build your

con�dence as most of the complicated stu� will become routine. I recommend your

practice include the following things:

1. Learn to deal the game including collecting bets and making payouts.

2. Learn to use your outcome cards to practice tactile betting with real chips.

3. Learn to use your outcome cards to practice logical execution of betting strategies.

4. Learn to use simulations as part of your game play strategy.

5. Learn to observe live games.

Like anything in life, the more you do it, the better you can become at it. You might be

wondering why I would contradict myself and recommend practicing a game that I said

requires zero skill to play. Well, it is not a contradiction because the game really doesn’t

require any skill to play you simply place money inside little circles on the table and wait to

see if you won or loss. It is all of the other stu� (money management, discipline, tracking

outcomes, understanding volatility and basic math) that you will need to master. You can

pretty much get all of the basics (8 decks of playing cards, 300, 400 or 500 piece poker set

and card shoe and automatic shu�er) from your local Target or Walmart stores. You can

usually �nd this stu� where they keep the board games. If you like to shop online, you can

get the stu� on Ebay. You can get graph paper from just about anywhere or you can make

and print your own. Whenever you deal shoes at home you should record the outcomes on

your graph paper and keep a copy of it.

Let me walk you through some of my practice routines so that you can get some ideas

about how you might approach this. If I am playing by myself, which means that I have to be

the dealer and the player, I simply set up my card and my chips as I would if I was playing a

live game and once I am all set up, I place a bet then I deal the cards to see if I won or loss. If

I lose, I collect the bet and put it in my dealer tray. If I won, I pay the bet. I make all of my

usual notes and continue on with the game. This is much faster, if you have someone to

act as the dealer for you. However, what you will notice is that live play is really slow it

takes about 30 minutes to progress through 30 hands at the mini-bac tables. The big

tables take about 45 minutes or more to cover the same number of hands. Another mode

of tactile execution, if I am simply planning to line bet one of the sides in a shoe, I can deal

80 hands and simply record the outcomes on one of my cards then, go back and make the

actual bets and payouts based on my bet selection. My �nal mode of solo play, involves

using my outcomes book to determine if I won a hand or not by using an index card to hide

the results and show them after I’ve made my bet placement. For logical execution, I

practice with my outcomes book and my money management card just plotting out what I

would have bet if I were playing. I can do the same thing when observing live games in the

casino. If you have an Apple Ipad, there is a Baccarat Free application. If you have a PC, you

can use the following free application to play online from the Wizard of Odds website:

http://wizardofodds.com/play/baccarat/new/

Lesson 8

Betting Systems

Understanding the Power and Perils of using them

You already know that betting systems do not change the underlying mathematics of the

game. So you might be wondering what good are they then? To answer that question,

let’s start with what these tools do for you in the short-term. Betting Systems are basically

http://wizardofodds.com/play/baccarat/new/

rules usually based on some kind of trigger event that tells you how much you should bet

and when. At a fundamental level, they are usually designed to create more paths to a win

and few paths to a loss. They do this by putting more money at risk in the hopes that the

underlying math of the game will align to make the payo� worth the risk. In other words,

Betting systems are the epitome of gambling. Another bene�t of betting systems is that

they can help you accumulate winnings at a faster rate than you would by simply �at

betting. However the major peril of Betting systems is that this function can cut both ways

which means that during a losing streak you can compound your losses. What is fun about

betting systems is that you can design them to provide you with a reasonable amount of

action, a corresponding amount of inescapable risk all tailored to the size of your bankroll.

Therefore, I highly recommend that gamblers evaluate factors that are important to them

and custom design an approach that is suitable for individual styles of play.

The thing to know and never forget when it comes to betting systems is that many will

appear to work most of the time, but it is not the system as much as the underlying math

that system depends on that makes it work. Therefore, you really should not be surprised

when you encounter a shoe that causes your system to fail catastrophically and when this

happens, you will have to accept the loss and not push it as doing so will only make it

worse. If you design a good betting system you should be able to get some good runs out

of it. Another thing you should be aware of when evaluating betting systems, is that most

modern betting systems are elaborate combinations of older systems. If you understand

the strengths and weaknesses of a series of betting systems, with practice, you can learn

to switch between them as the situation dictates.

Once you have a betting system you like, I recommend only playing enough to reach a

particular win target. You can go back and try another session if you want. But a word of

caution, most gamblers when faced with a losing streak will play di�erently (more

reckless) than they do when winning. This causes losses to balloon out of proportion to

the wins. Therefore, you should see your betting system through to the end and except

that losing is as much a part of the game and the experience as winning. With that being

said, let me illustrate the considerations that one must make by outlining one of the

systems that I use for my game play, and the process by which I arrived at the development

of this system and others. The �rst concept of consideration is that of Utility (what would

make me happy?) and the answer to that question: I would like to have the ability to play

for a while with a decent shot to win some money. The next question to ask and to answer

is how much am I willing to risk to pursue this goal? Finally, we calculate our best chance to

accomplish this goal (we covered much of this in previous lessons). For example, let’s say

that I would be happy winning between $100 and $200 per game and I would be willing to

lose $1,000 in an e�ort to achieve this goal. So the formula for calculating this is:

(Money I want to Risk / Money I want to Risk + Money I want to Win) = My Chance of Getting

Money I Want to Win Before Losing The Money I Want to Risk.

The math would look like this:

($1000 / $1200) = 83% chance I will be able to win $200 before losing $1000. Let’s lower the

amount to a $100 win.

($1000/$1100) = 90% chance I will be able to win $100 before losing $1000.

The aforementioned calculations tell me that I should stop playing when I’ve won any

amount between $100 to $200. Every $100 extra I try to win especially in the same shoe,

increases the risk that I will lose my $1000 before making an additional $100. The next step

involves determining how to use my $1000 bankroll to secure the win. Maximum boldness

says that my best chance of success comes from placing a single bet for the total amount

of money I would like to win. While e�ective, this approach would violate one aspect of my

utility and that is I would like to play for a while. So I use a method to spread the $1000

bankroll into a series of bets and I grind my way to a win. The o�sets di�erences between

wagered amounts and the betting rules will produce a pro�t of between $10 and $40 for

every bet that succeeds. The next table shows the distribution of my $1000 bankroll. The

top row represents the bet number. The bottom row shows the dollar amount of each

bet. On my money management card, these would be represented in unit numbers.

1 2 3 4 5 6 7 8 9 10 11 12 13

10 10 10 20 30 40 50 60 80 120 150 200 220

The total of all 13 bets equal $1000. The rules are structured so that it takes two hands to

resolve a bet. The strategy is simple, in Baccarat single events are the most common,

followed by doubles, followed by triples. This betting system relies on there being at least

one double at some point along the sequence. If we pass through the entire sequence of

bets without a double we bust and lose $1000. However, if we hit a double at any point

between bets 1-12 we recover any loss units and show a pro�t. If we get a double at bet

13 we will be down $340. If we get a double we start the sequence over from bet 1. If we

bust, we start the sequence over from bet 1. My system does both, I push when I am

ahead and I push when I am behind. I push when I am ahead by letting all of my winning

bets ride that is, my base bet plus my win becomes my next bet this is known as a pyramid

strategy. When I win two hands back to back my base bet is multiplied by 3. However,

when I lose, I only lose my base bet. The following table shows the amounts won from

successful parlays (row 3).

1 2 3 4 5 6 7 8 9 10 11 12 13

10 10 10 20 30 40 50 60 80 120 150 200 220

30 30 30 60 90 120 150 180 240 360 450 600 660

I push when I am behind, every time I lose a bet or a parlay, I advance to the next bet in the

sequence and I keep going until I score a win or bust. The following table shows a mapping

of win paths created by the sequence of numbers in my method. If a win occurs at bets

2-13, then that means that all of the proceeding bets were lost so any money won goes

�rst to payo� all past losses and amounts shown as pro�ts is what remains after

recovering all of the lost amounts. The formula for this is:

Units Won - Total Units Loss = Net Pro�t or Loss.

Bet Number Total Units Loss Net Pro�t

1 0 $30

2 1 $20

3 2 $10

4 3 $30

5 5 $40

6 8 $40

7 12 $30

8 17 $10

9 23 $10

10 31 $50

11 43 $20

12 58 $20

13 78 -$120

I could make my last bet $300 instead of $220 and it would return a positive amount of $120

but if I have lost by such a ratio that I have exhausted all of my bets. I should simply accept

the $1,000 loss which is easy to recover from. However, as the amount of money I win

grows, I can add more rungs to my ladder for example, bet 13 would become $280

followed by $360 for bet 14 and �nally bet $500 for bet 15. I should note for the record,

that I have a defensive mode of play that I can switch to once I get to bet 10 where the

objective would switch from winning to recovery only. The next task for any system is to

stress test it against my master shoes. In the �rst shoe this system busted three times for a

total loss of $3,220. I scored a few small wins which brought the total loss down to $2,950.

In Master Shoe #2 the system scored a net win of $540. Remember that the purpose of the

stress test is to show how unbalanced a method or a system is. The �nal stages of testing

involved tactile execution, logic testing on paper and trending analysis by programming the

betting rules into a computer and let the computer run a simulation of 200 hours of game

play. What I will be looking for in the simulations, is how many times the system busts how

long to it take to recover from a bust and is the overall trend in terms of winning positive or

negative. If negative, then I throw the system out. If the overall trend is positive, then I

keep the system as part of my arsenal. I have two modes of executing my strategy during

live game play, and which one I use depends on the observed volatility of the game. For

instance, if the game has high volatility very (choppy)

then always bet the bank. If the shoe is streaky then follow the shoe that is, bet on the

side of the last winning hand. If the shoe is lopsided, (strong banker or strong player) pay

attention to the point di�erence between the two sides. Ride the strong side until the

other side gets really far behind and then switch to the weak side. You would also opt to

sit out hands to conserve capital and wait for favorable conditions to develop before you

start playing again. But you should know, that this usually just delays the inevitable

because Baccarat is a persistently unpredictable game. Once you have your strategies

down you should play 30 games against the computer or by using your cards and poker

chips this is the equivalence 60 hours of live casino play. Keep track of your starting and

ending bankrolls so that you can track your overall progress. If you are successful, then

you should have won between $4,000 $6,000 and the end of 30 games. This would

represent a win rate of $100 to $200 per game. If you can do this in practice, then there is

no reason you cannot do it in the casino. Let me warn you about some of the challenges of

live casino play: First, everything in the casino happens in slow motion which means that

when losing hands things will (seem) a lot worse and when winning hands it will not

(seem) fast enough. These are perceptual problems that you can convert into positive

experiences by using the delays to update your cards, think about the volatility of the game

and just generally enjoy yourself as the game is unfolding. Second, is it’s noisy and

crowded. The noise and the crowds will begin to irritate you on a subconscious level after

a while therefore, you should get up and walk around for 20 minutes or so this is good for

the body also because it is not good to sit for long hours without a break. My triggers for

when to take a break are: Whenever, I reach a win target, or �nish playing a quarter of the

game (20 hands). The third and most important sign for when to quit is once you are tired.

Baccarat can be a mentally exhausting game, once your mind is tired you are done and

should stop playing immediately and leave the Casino. Mental fatigue is like being asleep

while you are awake, you have to learn to pay attention to what your body is telling you and

more importantly listen and take action. If you don’t get up when you are tired you will

start making mistakes and doing things that are irrational. You’ll will feel like the game

took a dramatic turn but the only thing that happened is you got tired and so are the other

people at the table if they have been playing for a while without a break.

My last recommendation, is spend some time away from the casino while it can be fun, you

need to take days o�. None of the advice I’ve given is guaranteed to make you a winner

but it will make you a better gambler and knowledge is power. Let’s wrap up this section

by completing the

analysis of some popular betting systems which were mentioned in previous lessons but

not reviewed. We will use the same test shoe patterns outlined in lesson 5:

1. All Losses

2. All Wins

3. Losses Followed by Wins

4. Wins Followed by Losses

5. Wins Surrounded by Losses

6. Losses Surrounded by Wins

7. Win and Losses Evenly Distributed

8. Clustered Wins and Losses

The betting progressions we will review are:

1. Anti-Martingale

2. D’Alembert

3. Parlay

4. Paroli

5. 1-3-2-6

5. U1D2M2

We will start with a review of the Anti-Martingale system. The table is laid out so that the

hand numbers are on the �rst and the �fth rows. The win/loss patterns are on the second

and the sixth rows and the units bet are on the third and seventh rows. The blank rows

are used to indicate where a system busts based on a bankroll consisting of the following

unit amounts [5, 10, 15, 20, 25, 30, 50, 100, 150, 200, 500, 1000]. If you will recall from earlier

examples, we have 12 players sitting at the tables that represented by the respective

bankroll amounts.

System: Anti-Martingale

Rules: Always bet 1 unit double on Win

Pattern #1 All Losses

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1

B B B B

Session Analysis for Shoe #1

1. player #1 goes broke at hand 5




5. player #5 losses 75% of bankroll







12 player #12 losses 2% of bankroll



Pattern #2 All Wins

1 2 3 4 5 6 7 8 9 10

W W W W W W W W W W

1 2 4 8 16 32 64 128 256 512

11 12 13 14 15 16 17 18 19 20

W W W W W W W W W W

1024 2048 4096 8192 16384 32768 65536 100k 100k 100k

TL TL TL

The power of the Anti-Martingale is simple in a winning streak you can pro�t big. TL show

the point when our players hit the table limit so they were limited to making $100,000 bets

for a total win per player of $365,593. The players wins were capped by the table limit.

Without the table limits, the players would have won $524,288 each.



Pattern #3 Losses Followed by Wins

1 2 3 4 5 6 7 8 9 10

L L L L L L L L L L

1 1 1 1 1 1 1 1 1 1

B B

11 12 13 14 15 16 17 18 19 20

W W W W W W W W W W

1 2 4 8 16 32 64 128 256 512




3. The rest of our players (3 through 12) win $5,020 each.



Pattern #4 Wins Followed by Losses

1 2 3 4 5 6 7 8 9 10

W W W W W W W W W W

1 2 4 8 16 32 64 128 256 512

11 12 13 14 15 16 17 18 19 20

L L L L L L L L L L

512 1 1 1 1 1 1 1 1 1

B B











11. player#11 losses 2% of bankroll




Pattern #5 Wins Surrounded by Losses

1 2 3 4 5 6 7 8 9 10

L L L L L W W W W W

1 1 1 1 1 1 2 4 8 16

B

11 12 13 14 15 16 17 18 19 20

W W W W W L L L L L

32 64 128 512 1024 1024 1 1 1 1

B
















Pattern #6 Losses Surrounded by Wins

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 4 8 16 16 1 1 1 1 1 1 1 1 1 1 2 4 8 16

B B




3. The rest of our players (3 through 12) have a net win of $60 or 6 units each. The formula

for calculating this is:

(Starting Bankroll - 10 ) + 16 units won) = 6 net units won.



Pattern #7 Wins and Losses Evenly Distributed

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 1 2 1 2 1 2 1 2 1 2 1 2 1 2 1 2 1 2

B B




3. players (3 through 12) su�er a net loss of 10 units each.

To get the percentage of loss for each player we can use the following formula:

Total Units Loss / Starting Bankroll = Percentage of Loss



Pattern #8 Clustered Wins and Losses

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 2 1 1 1 1 2 4 8 16 16 1 2 4 4 1 1 1 1

B



2. All other players su�er a 9 unit loss.

Let’s test the D’Alembert system across our test patterns.

System: D’Alembert

Rules: Add 1 unit after as loss, subtract 1 unit after a win.

Pattern #1: All Losses (20 hands)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

B B B B B B B B B B B













13. player #12 losses 21% of bankroll.


Rules: Add 1 unit after a loss, subtract 1 unit after a win.

Pattern #2: All Wins (20 hands)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1


All players win $200 (20 units)



Pattern #3: Losses Followed by Wins. (20 hands)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 3 4 5 6 7 8 9 10 11 10 9 8 7 6 5 4 3 2

B B B B B B B









The rest of the players (8 through 12) have a net win of $100 or (10 units).



Pattern #4: Wins Followed by Losses (20 hands)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 1 1 1 1 1 1 1 1 1 1 2 3 4 5 6 7 8 9 10

B B B B B B B B B B B B B

Session Analysis Shoe #4

The outcome for each player is calculated using the following formula:

(Starting Bankroll + 10 units ) - 55 units ) = Net Units















Pattern #5: Wins Surrounded by Losses (20 hands)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 3 4 5 6 5 4 3 2 1 1 1 1 1 1 2 3 4 5

B B B

Session Analysis Shoe # 5




4. The rest of our players (4 through 12) lose 5 units each.



Pattern #6: Losses Surrounded by Wins (20 hands)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 1 1 1 1 1 2 3 4 5 6 7 8 9 10 11 10 9 8 7

B B B B BB

B












Pattern #7: Wins and Losses evenly distributed (20 hands)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 1 2 1 2 1 2 1 2 1 2 1 2 1 2 1 2 1 2

B B




3. The rest of the players (3 through 12) lose 10 units each.



Pattern #8: Clustered Wins and Losses (20 hands)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 1 1 2 3 4 5 4 3 2 1 1 2 1 1 1 2 3 4 3

B



2. player #2 ends session with a 2 unit loss.

3. The rest of our player(3 through 12) all �nish with a win of one unit.

The next betting system I want to evaluate is the Parlay bet.

System: Parlay

Rules: Bet 1 unit, let all winning bets ride until the next bet, return to 1 unit after result.


1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1

B B B B







System: Parlay



1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 1 2 1 2 1 2 1 2 1 2 1 2 1 2 1 2 1 2


All of our player win 30 units ($300)

System: Parlay


Pattern #3: Losses Followed by Wins (20 hands)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 1 2 1 2 1 2 1 2

B B




3. The rest of our players (3 through 12) �nish 5 units ahead ($50)

System: Parlay



1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 1 2 1 2 1 2 1 2 1 1 1 1 1 1 1 1 1 1


All players �nish 5 units ($50) ahead.

System: Parlay



1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 1 1 1 1 1 2 1 2 1 2 1 2 1 2 1 1 1 1 1

B



2. The rest of our players (2 through 12) �nish 5 units ahead ($50)

System: Parlay



1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 1 2 1 1 1 1 1 1 1 1 1 1 1 1 2 1 2 1


All players �nish 3 units ahead ($30) The formula for making this calculation is:

(Starting Bankroll + 6) - 10) +7 = 3

System: Parlay


Pattern #7:Wins and Losses evenly distributed (20 hands)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 1 2 1 2 1 2 1 2 1 2 1 2 1 2 1 2 1 2

B B




3. The rest of our players (3 through 12) lose 10 units each ($100)

System: Parlay



1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 1 1 1 1 1 2 1 2 1 2 1 2 1 2 1 1 1 2


The net result of the above session is that all of our players �nish one unit behind - ($10).

This is captured by the following calculation:

(Starting Bankroll +2 ) -4 ) +3) -1) +3) -4) = -1

The next betting system we will evaluate is the Paroli. This system is very similar to the

Parlay and the Anti-Martingale system as the rules require the gambler to bet 1 unit until a

win is encountered and then double the next bet. Where the system di�ers from the

Anti-Martingale, instead of perpetually doubling a bet as the Anti-Martingale would call

for, the Paroli stops after two Parlays which means that it requires three successful bets to

complete a sequence.

System: Paroli

Rules: Bet 1 unit, let all winning bets ride up to a maximum of two bets. Reset on Win/Loss


1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1

B B B B






5. The rest of our players (5 through 12 ) lose 20 units each ($200)

System: Paroli



1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 3 1 2 3 1 2 3 1 2 3 1 2 3 1 2 3 1 2


All players �nish 39 units ahead ($390)

System: Paroli



1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 1 1 1 1 1 1 1 1 1 1 2 3 1 2 3 1 2 3 1

B B




3. The rest of our players (3 through 12 ) �nish 9 units ahead ($90) this result is calculated

by using the following formula: (Bankroll - 10) + 19 = 9

System: Paroli



1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 3 1 2 3 1 2 3 1 2 1 1 1 1 1 1 1 1 1


All players �nish 8 units ahead ($80) this result is calculated by using the following formula:

(Bankroll + 18) - 10 = 8

System: Paroli



1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 1 1 1 1 1 2 3 1 2 3 1 2 3 1 2 1 1 1 1

B



2. The rest of our players �nish 8 units ($80) this result is calculated by using the following

formula: (Bankroll -5) + 18 ) - 5 = 8

System: Paroli



1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 3 1 2 3 1 1 1 1 1 1 1 1 1 1 2 3 1 2


All players (1 through 12) �nish 5 units ahead ($50) this result is calculated by using the

following

formula: (Bankroll +6 ) - 10 ) + 9 = 5

System: Paroli


Pattern #7: Wins and Losses Evenly Distributed (20 hands)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 1 2 1 2 1 2 1 2 1 2 1 2 1 2 1 2 1 2

B B





System: Paroli



1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 3 1 1 1 1 2 3 1 2 3 1 2 3 1 1 1 1 2


All players (1 through 12) �nish 3 units ahead ($30) this result is calculated by using the

following

formula: (Bankroll - 4) + 6 ) -1 ) + 6) -4 = 3

Our next betting system is the 1-3-2-6 method. Basically, this system takes 12 units and

spreads it into four wagers you always start with one unit and continue through the

progression on wins but reset to 1 on loss.

System: 1-3-2-6

Rules: Bet 1 unit, if win continue to next number in sequence if lose, return to 1 unit.


1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1

B B B B






5. The rest of the players (5 through 12) lose 20 units each ($200)

System: 1-3-2-6



1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 3 2 6 1 3 2 6 1 3 2 6 1 3 2 6 1 3 2 6


All players �nish 60 units ahead ($600)

System: 1-3-2-6



1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 1 1 1 1 1 1 1 1 1 1 3 2 6 1 3 2 6 1 3

B B




3. The rest of our players (3 through 12) �nish 18 units ahead ($180) this result is calculated

by using the following formula: (Bankroll - 10 ) + 28 = 18

System: 1-3-2-6



1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 3 2 6 1 3 2 6 1 3 2 1 1 1 1 1 1 1 1 1


All players �nish 17 units ahead ($170) this result is calculated by using the following

formula: (Bankroll + 28 ) - 11 = 17

System: 1-3-2-6



1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 1 1 1 1 1 3 2 6 1 3 2 6 1 3 2 1 1 1 1

B



2. The rest of the players (2 through 12) �nish 17 units ahead ($170) this result is calculated

by using the following formula: (Bankroll - 5 ) + 28 ) - 6 = 17

System: 1-3-2-6



1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 3 2 6 1 3 1 1 1 1 1 1 1 1 1 1 3 2 6 1


All players �nish 14 units ahead ($140) this result is calculated by using the following

formula:

(Bankroll + 13) - 12 ) + 13 = 14

System: 1-3-2-6



1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 3 1 3 1 3 1 3 1 3 1 3 1 3 1 3 1 3 1 3

B B B B







System: 1-3-2-6



1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 3 2 1 1 1 1 3 2 6 1 3 1 3 2 6 1 1 1 3


All players �nish 5 units ahead ($50) this is calculated by the following formula:

( Bankroll + 4) -5) + 13 ) -3 ) +6) - 8) +1 ) -3 = 5

The �nal betting system we will evaluate is called U1D2M2. This betting system appears to

be a variation of the D’Alembert Betting system. The system requires you to increase the

bet one unit after each loss thus the “1U”, and down 2 Units after a win “D2” and a

Mandatory 2 Unit bet after a 1 unit win. Structurally, the system keeps you betting

between 1-3 units during winning streaks and rises gradually during losing streaks and fall

rapidly (2 units per win) after a winning streak has �nished. The system has some

interesting dimensions to it.

System: 1UD2M2

Rules: Bet 1 unit, if lose raise bet by 1 unit, if win, lower bet by 2 units bet 2 units after 1 unit

win.


1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

B B B B B B B B B B












11. The rest of our players (11 and 12) both lose 210 units ($2,100) each.

System: 1UD2M2


win.


1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 1 2 1 2 1 2 1 2 1 2 1 2 1 2 1 2 1 2


All players �nish ahead by 30 units ($300)

System: 1UD2M2


win.


1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 3 4 5 6 7 8 9 10 11 9 7 5 3 1 2 1 2 1

B B B B B B B









8. The rest of our players (8 through 12) all �nish behind by 13 units or ($130) this result is

calculated by using the following formula: (Bankroll - 55) + 42 = -13

System: 1UD2M2


win.


1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 1 2 1 2 1 2 1 2 1 2 3 4 5 6 7 8 9 10

B B B B

Session Analysis shoe # 4







7. All other players (7 through 12) players �nish behind by 40 units ($400) this result is

calculated by using the following formula: (Bankroll + 15) - 55 = - 40

System: 1UD2M2


win.


1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 3 4 5 6 4 2 1 2 1 2 1 2 1 2 3 4 5 6

B B B




4. All other players (4 through 12) lose 13 units each ($130) this result is calculated by using

the following formula: (Bankroll - 15) + 22 ) - 20 = - 13

System: 1UD2M2


win.


1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 1 2 1 2 3 4 5 6 7 8 9 10 11 12 10 8 6 4

B B B B B B









8. All other players �nish 80 units behind (-$180) this result is calculated by using the

following formula: (Bankroll +7) - 65 ) + 40 = -18

System: 1UD2M2


win.


1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 3 1 2 1 2 1 2 1 2 1 2 1 2 1 2 1 2 1


The net result is all players �nish ahead by 4 units ($40)

System: 1UD2M2


win.


1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20


1 2 1 2 3 4 5 3 1 2 1 2 3 1 2 1 2 3 4 2

B



2. player #2 �nished 3 units ahead because he didn’t have enough money to make one of

the required bets ($30)

3. The rest of our players (3 through 12) �nish 5 units ahead ($50) this result is calculated by

using the following formula: (Bankroll + 3) - 10 ) + 12) -2 ) + 6 -6) + 4) -2 = 5

As you can see from all of the examples I have provided, betting systems will have varying

outcomes and those outcomes will largely depend on two things; First, the size of your

bankroll you need to have enough money to support the kind of betting system you want

to employ at the tables. You need to have enough money to survive downswings of

unknown durations and know your bust points! that is, the total amount of bet you can

lose before you go broke. The higher number of losses you can sustain, the better your

chances are for recovery. I know that this might appear counter intuitive, but if you look

back over the examples, you will see that the players with the higher bankrolls were able

to survive the downswings and in most cases came out okay. However, during really bad

losing streaks the betting systems in many cases only made the losses greater. The

second thing, is betting systems only work when the underlying mathematics align to

support the method used. Therefore, it is incumbent that every gambler logic test and

simulate betting approaches before trying them when real money is on the line so that you

can get the best measure of the pros and cons of employing them. I stand by my

recommendation that every gambler should custom design a betting approach that

balances bankroll, action requirements and risk tolerance. Betting systems sold my system

sellers are nothing more than classic betting approaches cobbled together in di�erent

ways.

For example, I haven’t talked a lot about side bets in Baccarat like the Dragon bonus or the

Tie bets because as a general measure I simply avoid bets that have very high house edges.

But a fellow player recently told me that she bets on the ties for the �rst three hands of

every shoe. This seems like a completely reasonable approach to me, because she is

limiting the amount of total money she will allocate to burning on side bets and whenever

a shoe starts with a tie as one of the �rst three hands, she will get an 8-1 payo�. Yet there

are other players who make side bets a big part of their regular game play but I don’t think

that they have given much thought to how those bets contribute to the premature

depletion of their bankrolls. My recommendation to anyone who throws regular money

on the dragons and ties is to track the hit ratios, once you see how bad it is and how much

it is costing you, you might come to realize that it is simply not worth it. I know that a lot of

players bet the dragons and the ties as a lifeline to revive a bankroll that is nearing zero.

But a better approach would be to simply stop playing while you still have some money left

and come back and play another day, because the much more likely outcome, is that you

are going to lose a disproportionate number of those bets and it will only accelerate your

demise. So far I have provided you with a lot of information on the underlying mathematics

of the game of Baccarat and casino games in general and while casino games can be fun to

play, they are structured in ways that make it easy for you to lose your money but di�cult

for you to win much. Most casino games don’t require a lot of skill to play but they do

require you to understand and to appreciate the odds you are challenging when you

decide to play them. If you want to have any chance at actually winning, you will have to

master self-discipline, patience, wisdom to develop an e�ective strategy to reach your

goals and the courage to see that strategy through. In addition, you’ll understand that it

takes a considerable amount of money to survive the downswings. Once you fully

understand the risks you are taking, then you will be able to appreciate why it is di�cult to

“beat the house” you will also abandon any notions of earning a stable living from gambling

because the best you will be able to accomplish is to lengthen the cycles between booms

and busts, this means by implication that when you are not winning, you will be losing,

breaking even or recovering from a past loss therefore, you will really have to enjoy the

journey and you will discover that to make (win) money playing this game on a near

persistent basis is a lot of work, so much so, that you really would be better o� doing

something that actually guarantees a payo� that is, of course, unless you actually enjoy

the thrill of the chase which can be a lot of fun every so often. But do it do much and too

often, and you will �nd it to be a major source of aggravation, frustration and dred. So it is

paramount that you spend some time away from the game to get your bearings.

A subtle e�ect of gambling is that once you get into the games you are encouraged to go

for broke in an attempt to score a win therefore, it is imperative that you �rst de�ne what

it means to win and second, de�ne what risks you are willing to take to score this win.

Finally, and most important, what it will mean to you if you are unsuccessful? You will

discover in the end that gambling is about you. It is about the kind of person you are, in

terms of the utility you assign to your money and your time. For example, in playing

Baccarat for over a year as part of my experiment, I have wagered over $300,000, won

about $30,000 lost about $23,000. The game edge has cost me about $7,000 for a net result

of Baccarat which is zero. The casino on the other hand �nished $7,000 in the black. This

brings us full circle to lesson 4 “Understanding the Concept of a Negative Expectation

Game” where the casinos pro�ts are determined by the following formula:

Pro�ts = (Total Wager) x (Edge)

When you look at my numbers:

$7,000 / ($300,000) = 2.33%

This result brings me back to something I said earlier and that is, when playing games that

have a house edge you will pay in one of two ways, either in terms of losses or through

reduced winnings. I paid a little of both and this outcome illustrates why it is so important

to know how far ahead or behind you are at all times, as it is the only way you can play and

keep the edge low.

Chapter 7

Winning the Long Game

With the experience of hindsight, I can look back at the games I played especially the ones I

lost and see that in most cases I killed myself. I did this in several ways:

1. Not playing with enough money.

2. Not betting progressively (playing scared)

3. Quitting prematurely (being scared of losing streaks)

4. Not having a plan (how much I want to win vs how much I am willing to lose to achieve

that win)

5. Playing while tired. (not following through, lack of will)

In addition to other things I have outlined in the book, these were the primary reasons I left

money on the table which means that I lost more than I had to. Once I got a �rm grasp of

the fundamentals, most of what is covered in this book. I came to the conclusion that the

only way to win, especially if you want to play a while, is to have as wide of a spread as

possible (the di�erence between your lowest bet and your highest bet). Furthermore,

another essential aspect is to press your wins or bet progressively, this is something you

will likely have to train yourself to do. This is because, your natural inclination is to protect

your wins and the best way to protect your wins, is to get up from the table. If you can

a�ord it, you want to start with at least a 1:100 spread that is, if the table minimum is $10,

you should be able to bet up to $1000 if necessary. The primary purpose of these larger

bets is not to win money as much as they are necessary to keep your loss balance from

growing out of proportion to what you can win. Remember that it is easier to lose these

games than to win them therefore, you need to counterbalance this aspect of the game.

A spread of 1:100 with a win target of $100 (10) units has a 90% chance of success. But

once you play longer to use that same spread to go for $200 win, your chance of success

drops to 83% which means that the threat to you losing your $1,000 bankroll jumps from

10% to 17% this threat will keep rising the longer you play and the more you try to win. The

bigger you make the spread the better. I know that people make fun of me when I sit at a

$10 table with a $10,000 bankroll and start betting $10 a hand but I hope that after reading

this book, they will be able to appreciate the wisdom of doing so, especially considering

that bet size is relative to bankroll for example, if I bet $1000 per hand and I win 10 hands

but lose 11 not only will I be broke but I would be $1,000 in the hole. This outcome would

be no di�erent from the guy who walks up to the table with $100 bankroll and bets $10

per hand.

But because my spread is 1:1000 my chance of winning $100 is 99% and of winning $200 is

98% which means that the corresponding risks to my bankroll is 1-2% and furthermore, I

can bet my way out of a bad situation without any real risk of going broke doing so, and this

fact inspires con�dence. Therefore, thrill or fear is limited to not knowing the length of

the adverse run or downswing. But it is not in anyway related to leaving the table broke.

players with spreads that are less than 1:100 are particularly vulnerable to having their

money chipped away at especially, if those players don’t have an established win target or

a betting strategy that would allow them to play for a while and have a decent chance to

win some money. These players best chance to win comes from making as much as

possible from the fewest bets as possible and quitting while ahead.

Once, I got on the right path which means that I started winning just about as easily as I see

people lose, as winning just requires varying degrees of e�ort in terms of the risks you are

willing to take to win. It wasn’t that I discovered some unknown branch of mathematics

that made the game consistently winnable, but rather, by tearing the game apart and

looking at the underlying mathematics including volatility I was able to see and study the

relationships starting from the underlying mathematics of the game all the way through to

the players experience. Because I have lived long enough to know that most discoveries

are not entirely unique I started doing research on the concept of “winning more when

you win than lose when you lose.” With that search, I learned that Seth Theobeau of

( http://w w w.sethbets.com/aboutbaccarat.html ). Seemed like the only person and the

most credible authority on something he calls Targeted Betting. While I would love to take

credit for being the �rst person to conclude that the only way to win at Baccarat is to bet

in a way so that your average win is larger than your average loss. Seth appears to have

pioneered the idea. Furthermore, he has produced reams of compelling data to support

his assertions. You can read his blog here ( http://targetbetting.blogspot.com/ ). I have no

a�liation with Seth and I only bring him up because I think he deserves the credit for his

work in this area and second because his �ndings mirror both my technical and practical

�ndings.

In addition to simply documenting my �ndings, the thing that motivated me the most to

�nish this book was a conversation I have with another player who like so many times

before, sat at the same table with me, played the same game but at the end she was

broke. She o�ered to buy me a drink and started the conversation with how she always

http://www.sethbets.com/aboutbaccarat.html

http://targetbetting.blogspot.com/

loses. The she said to me, “you always win, you never lose.” I corrected her by informing

her that I lose just like everyone else just not as often or catastrophically as the other

players. Depending on how I decide to play, I can break even, and even is good in a casino. I

can push it and blow away some of my winnings, or �nish a few bets behind or simply quit

when I am ahead. Which is an action I am much more likely to take than any others. I

explained that I am not special, it really just depends on the math and what it means to win.

She looked at me with tears in her eyes and said “Can you tell me how to win?” I was

stunned into silence because at that moment, I could see her desire for some kind of holy

proclamation and I knew that any credible answer I could give to that question would be

too long and too complicated to provide to a person who had just �nished getting beat up

at the tables. So every time I think about her and many others, it motivated me to answer

the question and this book is the beginning of the best answer I could give to the question.

If you started reading from the beginning, then you have been presented with concepts

which will help you to understand and process the information I am about to give you in

the spirit it is intended. However, if you are starting here, you need to go back and read

the book from the beginning because every subject is dependent on the one before it and

there are no shortcuts to success when playing a game of chance where the odds are

stacked against you.

Lesson 9

Understanding the Long Game

To play Baccarat as a long game you need �ve things and they are:

1. A Goal

2. A Bankroll

3. An E�ective Method

4. Discipline

5. Time

Let’s start by de�ning a long game, a long game in Baccarat is a series of shoes that you

play as a single long game, and your goals are going to be de�ned and achieved over the

long game. Individual shoes break this long game up into neat little boundaries of time and

play. Remember that a shoe contains about 80 hands and it takes about 2 hours to play

from start the �nish. Therefore, if we were to set a 100 shoe limit, we are looking at about

200 hours of gameplay and about 8,000 decisions. If you are relying on any kind of bet

placement system you can expect your hit ratio to be somewhere in the 30% to 40% range

which means you will miss about 60% to 70% of the events that are available to you.

Therefore, I recommend that you pick a side and stick to it. If you like player, bet player and

if you like banker bet banker. If you want to change between the the two occasionally you

can do that too. But be warned the more you chase individual decisions around, the higher

your miss ratio climbs. There is nothing worse than looking at a tote board that looks

completely �ne and you realized that you have missed 10 in a row because you were

always in the wrong place at the wrong time. While it is hard to do, line betting can

increase your hit ratio for the events you care about to 100%. This will be really good in

shoes that are lopsided in your favor where your side beats the other side by 20 points.

However, it will be a bad day when the opposite happens. The good news, is that the vast

majority of shoes you are likely to encounter will be somewhere in between those two

extremes where the banker and player events will reach parity or will di�er by up to 7 to 8

points per game. The bad news, is you will never know what you are going to get when you

sit down at the table.

Within each shoe is 4 quarters composed of 20 hands each, you are going to start and end

your sessions inside of those quarters. Adverse conditions may cause you to not score any

wins in a quarter, other times, you will win really well in the �rst quarter, but won’t do

anything but lose in the next two only to get bailed out in the last quarter of the game.

This can happen during any point of the game and is an e�ect of volatility at work. You can

use your money card to track the distance (hands) between winning and losing events.

Sometimes, the volatility in a game is constant other times, it is uneven. I am telling you all

of this because you can use the volatility present in the game as a marker for when you

should �nish a session. My personal preference is not to play a shoe longer than I have to

reach a particular win target. The thing to always keep in mind and never forget is that you

are playing a game and the points that you accumulate amount to money. The more points

you have the more money you have.

Lesson 10

Establishing Clear Gambling Goals

If you are a regular Baccarat player or a regular casino patron, you want to get a win/loss

statement from the casino so that you can establish how far behind you are. We know

from previous lessons that $10 = 1 unit and 1 unit can be thought of as 1 point. Once you

have your win/loss statement, you should convert the negative amount into points and

then play the casino to get that point balance to zero. For example, if my win/loss

statement showed a loss of $800. I can convert this amount into units which would be 80

or points. With this number in mind, when I play Baccarat I can start chipping away at that

negative number (5, 10, 15, 20) units at a time until the balance reaches zero. Once the

balance reaches zero, then you will be ready to work on the real plan and it starts like this:

1. If you have a bankroll that is less than $1000, for example, $300 then you want to try to

build your bankroll up to $1000 or (100 units / points). For a 90% chance of success, your

win target should be set to $30 per session. This means that you are going to risk losing

$300 to win $30. There is a 10% chance you will lose your three hundred bucks before you

can win $30. Therefore, if you want to press and protect your fragile bankroll, you should

bet the winnings only that way if you lose, you will be back at zero and not behind. Then

you can start all over again. In terms of utility, a $300 bankroll can buy you 30 chances to

win 30 bucks before you go broke. Raising your base bet by $10 cuts the number of

chances you can a�ord in half. Therefore, you probably want to use a betting method that

is a combination of �at bets and parlays. Flat bets to keep you from going broke too fast

and parlays to act as 3 x multipliers when ever you can win two bets back to back. If you

can roll a $300 bankroll into a $1,000 bankroll then you can pat yourself on the back

because you would have succeeded in tripling your bankroll. Now, because you are

playing a Long Game, you don’t need to try to accomplish this in a single shoe. The overall

idea is to try to win some points in every shoe you play without being sent to the lockers

because you went broke. If you are starting with a $1000 bankroll, your goal is to reach

$3,000. If you can reach that amount then you can pat yourself on the back because you

just tripled your bankroll. You will want to keep adding $1,000 as often as possible and if

you are successful overall after about 100 shoes you should have about $15,000. You want

to set your milestones low, for example, instead of thinking about $3,000. Just work on

getting from $1,000 to $1,500 and from $1,500 to $2,000 so on and so forth. While you can

always take this money out of the casino, I recommend leaving it in the chip bank for two

primary reasons �rst, because leaving your chips there will keep you focused on what you

are trying to accomplish and second, you can use those winnings to insulate you against

any losses you might take and while it will be a setback, those losses are only temporary.

Once you reach the $3,000 milestone, it shouldn’t be necessary for you to bring any new

money into the casino as you can use half of your winnings as your gambling bankroll.

Furthermore, the only money you should always take from the Casino is money related to

your net losses. Now that I have outlined the goal and provided some information about

how you can go about bootstrapping your bankroll, let’s wrap up with the �nal dimensions

which are; playing using an e�ective method for system. I generally shy away from

prescribing to people exactly what betting system they should use when playing because

everyone has di�erent bankrolls, win targets and risk tolerances. Therefore, people

should custom design a betting system that works for them. For instance, I use a mashup

of the following betting systems: Fibonacci, Parlay, D'Alembert and depending on the

circumstance, I can switch to other layouts. Therefore, whatever method you use is good

enough if you can triple your bankroll using it. The last two aspects I want to discuss are

discipline and time. If you are actually patient enough to take the time to accomplish the

goals that are outlined here playing Baccarat, accept the setbacks with grace and dignity

and learn the lessons they teach, not only will you win some money, but you will have

obtained something far greater and that is you would have mastered yourself.

Good luck and see you at the tables.

Chapter 8

Playing the Long Game

Welcome back! If you’ve made it this far, then you know probably more than you wanted to

know about the various aspects of gambling. In fact, mastery of self and the e�ective

management of your money is the most important aspect of gambling. Another important

factor which is often under appreciated is time management. In this chapter we will cover

what you’ve been waiting for and that is some examples of how what I’ve talked about so

far looks like in actual practice. In the last chapter, I left o� by covering the concept of the

Long Game and we will pick up on that concept. Basically, a Long Game is a series of

games you play towards meeting an overall goal. The goal will largely take two forms:

1. Recovery games, these are games where the win balance are applied toward recovery

of your net loss that is any amounts that cause you to be to the left of zero. Once your

wins are to the right of zero, then the recovery games can be used to recover any loss

units due to wipe outs or setbacks which should be rare with the right con�dence levels

and methods.

2. Progress games, these are games you are playing to gain ground towards

reaching your win targets.

In chapter 7 titled “Winning the Long Game”of the last book we talked about taking a

$1,000 bankroll and trying to reach $3,000. I also talked about how to bootstrap a $300

bankroll into a $1000 bankroll. However, I will start this book by �rst covering concepts

related to the utility of money and casino gambling, then I will dispel a popular myth

regarding mechanical gambling systems when applied to games like baccarat.

Lesson 11

Understanding the Utility of Money when it comes to

casino gambling

Every gambler who plays casino games places a value on the money they are risking in

order for a chance to win some money. In fact many dream of being able to �nd a way to

take minimal risks but score life changing payo�s. Yet others, dream of a situation where

they can turn gambling into a reliable source of income. There are three fundamental

challenges that stand in the way of 99% of gamblers reaching this goal:

1. Time

2. Money

3. Math

Casinos are in the entertainment business and time is money so built into each of their

games is an edge which guarantees the casinos a payo� which amounts to a �xed

percentage of the total amount of money you cycle through their system. Therefore, the

longer you play their games the higher the cumulative costs to your bankroll. This edge

doesn’t mean that you will go broke, but it does mean that after a signi�cant amount of

play the edge will grow to consume the entire value of your bankroll. If you don’t keep

track of your win loss ratios these amounts can grow to consume your entire wealth! This

is why people think gambling is dangerous, I don’t think that gambling is dangerous, I think

the way people gamble is dangerous. The games never change, what happens is that over

time the players change. Another way to think about the function of edge relative to your

money is to picture a wheel. This wheel is your money, on opposite sides of the wheel are

two values win and loss, these two values counterbalance one another and the more you

try to control the position of the wheel the faster it spins. Edge is a blade that is slicing o�

a thin layer of that wheel with each passing turn and over time that constant grinding

would wear the wheel down to nothing. The smaller the wheel the faster this happens

the bigger the wheel the slower this happens. Conversely, the slower the wheel turns,

the slower this happens. The function of edge is something that cannot be overcome

because basically it is the built in cost of playing the game and is therefore a mathematical

reality. But the edge is separate from winning and losing because the math is set in such a

way that the net result of a long series is break even, �nish slightly ahead or slightly behind

due to standard deviation. Gambling is therefore a very simple mathematical proposition:

Can you Win X before Losing Y?

Which brings us back to the �rst concept as it relates to the utility of money when

gambling and that is time. Let’s start with the 1% of gamblers. All gamblers should know

that at a minimum the more money they have the more chances they have to win. They

also know that to get the most mileage out of their money and to overcome the break

even e�ect of the game, they will need to resort to some form of progressive betting

which means that they should not make bets so big that they cannot sustain additional

losses, or so small that the wins and losses cancel each other out. This gets us back to the

conversation on betting spreads that is, the di�erence between your lowest bet and your

highest bet. A single well funded player with a bankroll of $1,000,000 or more would be

able to play the casino for 9,000,000 decisions, such a player, would have 99% con�dence

that he can win $10,000 virtually every time he plays. The bigger the bankroll the bigger the

con�dence. Such a player or players could present a real challenge to the casinos bottom

line. For example, lets say you have 12 players that have bankrolls of at least $2,000,000

each and they decide to play baccarat where they all play follow the leader and the

objective of their play for the evening is to start with $100,000 players bankrolls bets in an

attempt to parlay a winning bet 4 times. The size of the players bankrolls will give them 20

chances to do something that only has a 12.25% chance of being successful in any given

attempt, which means that the casino has a 87.75% chance of gaining $24,000,000.

However, if the players win, and they can pull this o� a couple of times during the night,

then the situation would not be good for the casino as the players combined winnings

would total $37,200,000 for a single successful attempt. What if they were able to score

three wins! So the casinos protect themselves by setting table limits which e�ectively

hobbles players whose bankrolls can present a serious challenge to the casinos bottom

line. Furthermore, players of this type are not likely to hang around the casino long enough

to allow their winnings to end back up in the dealers tray. But there is another practical

reason more rich people don’t gamble and that is time, you see, anyone with a

considerable amount of money probably got that money not by chance but by taking a

series of very deliberate actions. Furthermore, people who have money, value their time

and when you value your time, you will come to realize that there are much more e�cient

ways to allow your money to work for you. Sitting in a casino making wagers doesn’t

qualify . To appreciate this concept, imagine building a business where you put in a lot of

work up front but once everything is up and running, you can hire other people to make

sure it keeps working, then you can sit back and simply collect the returns for years.

Therefore, for people with a lot of money, who could win every time they play, means that

if they decided to engage in the act of gambling, they themselves wouldn’t be gambling

but actually working the tables for their money, and the time and e�ort required to do

this has a low utility for someone who has more money than time. Ironically, the people

who could really win in ways that others can only dream of are the least likely to play

especially at low stakes because it doesn’t present a challenge and is simply not worth

their time. Which means by extension gambling has a high appeal to people who have

more time than they have money.

Of the people who have the time to invest in gambling, their main problem is not having the

money to do so at a level which would make it worth their while. But when you consider

the steep losses that many of these players have taken some of which runs into many

thousands, it becomes evident that they had the money but didn’t really understand the

math and furthermore, they were and are doomed by the impulsive nature of their greed

and fear. The players play styles while rational, only contributes to their demise this is

because most players are trying too hard not to lose so they are killing their chances to

actually win. To understand this concept better, you only need to know that most of the

games are designed so that players will lose slightly more often than they will win. So that

when a player tries to control this by making sure he can win more often than he loses he

will only create more volatility. Going back to our example where your money is a wheel,

the more you try to control the position of the wheel the faster it turns. In a game like

baccarat players focus too much attention on trying to do the impossible like predict the

future and sco� at the idea of simply reacting to the past as a dangerous and risky idea.

Furthermore, betting on a single outcome is considered a “boring” way to play the game.

These are all curious positions especially when the math tells us that both events are

equally likely we just don’t know in which order they will come. But if we are applying hard

math to the game, it won’t really matter much because whether we get the cheese or the

hammer is totally determined by how something happens and if we can craft a response

that captures the vast majority of the hows, then we will either win in ways that is

consistent with our con�dence levels which are based on hard math or we will lose every

penny of the money we are risking trying. Which brings us back to our proposition can we

win X before we lose Y which is the fundamental essence of baccarat and gambling in

general.

I would like to dispel the myth that no mechanical system has a chance at winning baccarat

in the long run, and while I agree with the overall sentiment of such an assertion, I

completely disagree with the proposed alternative of relying on bet placement systems as

a viable alternative. Here’s why:

1. Baccarat is a perfectly designed, virtually symmetrical game that uses zero as its center

of gravity. But, the house edge, causes the center to be negative one. Therefore on a

number line the game would look like so: Zero is the natural center of the game, but the

house edge causes the game to skew to (-1)

-10 -9 -8 -7 -6 -5 -4 -3 -2 (-1) -- 0 -- 1 2 3 4 5 6 7 8 9 10

This mathematical fact has the following in�uence on �at betting systems where a single

unit is bet consistently over the various curves of volatility and the net result is a -1%

return. But what this does to the other two types of betting approaches is far more

interesting. Let’s call them money management systems for clarity (what we do with our

money). Most money management systems will fall into one of two camps and they are:

positive progressions (bet more when winning) which pushes to the right of zero. And,

negative progressions (bet more when losing) pushes to the left of zero. Both

approaches, change the players experience in the following ways: A positive progression

accelerates away from zero during winning streaks but it only takes one loss to bring this

one crashing back towards zero or to the negative side of the scale. Furthermore, it is a

constant struggle to stay above zero as the gravity of the game pulls the player back

towards zero which means that the game is constantly grinding away at the bankroll.

Interestingly, negative progressions pour money into the game by loading up the negative

side of the scale and with the right o�sets, one of two things will happen, the player will

go broke before scoring a win or a single win will recover all losses and thrust the player

into positive territory. The bottom line, there is an underlying level of mathematics

operating at all times during the game that is shaping the players experience and the more

you understand how this operates the better you can understand what you can and

cannot change.

2. No matter how many di�erent combinations there are, the math tells us that at a basic

level there are only three outcomes to every single game (each hand): banker wins, player

wins or tie. The math also tells us that the most common events are singles, the second

most common are doubles, followed by triplets. The longer the streaks the more rare the

occurrence. Ties happen about 1% of the time or on average about 8 every 80 hands. The

problem is that we will never know the exact composition of the shoe we are playing but

instead of trying to guess the composition which is basically what bet placement systems

attempt to do, we should trust the underlying math to deliver the game to us and we

simply respond mechanically using pre-establish and consistent rules. By doing this, we

will win what we expect to win, and lose, what we expect to lose when we lose, on a basis

that is consistent with our prede�ned con�dence levels. This is in e�ect using the

underlying math to our advantage. Now, I can appreciate why people religiously rely on

bet placement systems even though mathematically they can be demonstrated to be no

better than single sided betting and in many instances worse. Bet placement systems give

the player an illusion of control that is, when the shoe is consistent with their chosen

pattern or trend plays they win but when it is not they lose. What bet placement systems

do, is they cause players to have a lot of misses in situations where they could have

bene�ted from the events that actually showed up rather than betting where they

predicted the next event would be. When a player is out of sync the misses really start to

add up and the losing streaks can be long and brutal. Therefore, the path of least

resistance, when playing baccarat would be to pick any event and use your money to seek

out matches and �gure out how to use those matches to your advantage for example take

the following shoe (keep in mind that you don’t know what is going to happen, so you are

looking at the past.) I am going to show you several examples of what happens when you

let the math determine if you win or lose.

Reference Shoe:

1 2 3 4 5 6 7 8 9 1

0

1

1

1

2

1

3

1

4

1

5

1

6

1

7

1

8

1

9

2

0

B P P P P B B P B B P P P P P B P P P B

2

1

2

2

2

3

2

4

2

5

2

6

2

7

2

8

2

9

3

0

3

1

3

2

3

3

3

4

3

5

3

6

3

7

3

8

3

9

4

0

B P B B P P B P P P P B B P P B B P P B

4

1

4

2

4

3

4

4

4

5

4

6

4

7

4

8

4

9

5

0

5

1

5

2

5

3

5

4

5

5

5

6

5

7

5

8

5

9

6

0

B P B P B B P P B P B P B B P B P P P P

6

1

6

2

6

3

6

4

6

5

6

6

6

7

6

8

6

9

7

0

7

1

7

2

7

3

7

4

7

5

7

6

7

7

7

8

7

9

8

0

P B P B P P B B B B B P P B P P B B P B

Let’s tear this shoe apart by event distribution:

Event Count

B 36

P 44

BB 12

PP 16

BP 22 (10) *

PB 22 (10) *

Let’s look at the stats in terms of hit ratios for each event type: (wins / total hands = 80 )

B = 45%

P = 55%

BB = 15%

PP = 20%

BP = 27% (12%)*

BP = 27% (12%)*

As you can see from the above numbers if you back single events either banker or player

your hit ratios will never be worse than what is delivered by the game. The more events

you back, the lower your hit ratios become. Simply backing doubles (BB or PP ) on the

same line (player or banker) cuts your hit ratio in half. But you really don’t need to win a lot

of hands if you concentrate your e�orts on winning the hands that are delivered by the

shoe, then you win whenever a match comes along and you start a new series in search of

the next win. The math tells us that if our match criteria is BB then we win 12 hands and if

our match criteria is PP then we win 16 hands.

* When we set a match criteria that jumps from line to line, (PB or BP) we run into a

problem that is fundamental with bet placement systems and that is, being out of sync

with the events as they come out of the shoe this produces the worse possible hit ratios.

Bet placement systems attempt to address this by waiting out events, playing on paper

before betting and other voodoo. But all of that e�ort is a futile attempt to predict the

future. To the players that rely on such systems, when the matches occur, the results

seem inevitable. But this is like a broken clock having the right time twice a day. While

there were literally 21 BP and PB events we are only able to capitalize on only about 11 of

them because by the time we �gure out the pattern it has already happened or is not what

we think that it is going to be. All of this will become clearer when we start to measure the

volatility by counting the number of hands we lose before we encounter a winning

condition. We can measure the volatility by counting the number of hands we lose

between each winning event. Knowing the distance between matching events serves as

an important metric for what kind of money management system we apply to the game. It

gives us some pretty good ideas about bankroll drawdowns and we can use this

information to establish bust points that is, when we consider the losses extreme enough

to simply give up. Something you will likely want to do if you �nd yourself on the wrong

side of standard deviation.

The numbers inside of the brackets represent the number of loss hands before

encountering a win for example [5,1,5,3] means we lost 5 hands between the �rst and

second win , lost one hand between the next, lost 5 hands before the next and lost 3

hands before the next so on and so forth. By averaging these results we get the center

point.

Banker Events:

[5,1,5,3,1,2,4,2,2,1,1,2,1,1,1,5,1,2,2,2,1] average distance = 2.41

Player Events:

[1,2,2,1,2,2,1,2,2,2,1,2,1,1,2,1,1,1,5,1,2,1] average distance = 1.63

BB Events: (doubles)

[5,1,9,1,7,2,2,3,6,12,0,6,2] average distance = 4.30

PP Events

[1,0,5,0,2,6,1,0,2,2,7,8,0,4,5,1,4] average distance =2.82

BP Events (opposites)

[4,12,4,5,1,1,0,4,0,18,8] average distance = 5.18

PB Events (opposites)

[14,2,10,2,2,0,0,8,4] average distance = 4.2

As far as baccarat shoes go, our sample shoe is pretty much typical of the type of shoe you

will �nd on any given day at the casino. In terms of event distribution, you want to stay

with single-sided outcomes and capitalize on doubles as the more you hop from line to

line, the lower your hit ratio drops.

When I play baccarat, I play mechanically, that is, I have a �xed set of rules and I play until I

hit my win target or bust. Therefore, when I sit at a table I never know if I am going to get

the cheese or the hammer. It all depends on the math.

I have many methods but my favorite one is a mashup of Fibonacci, Parlay, D’Alembert and

Star. I have three levels of risk: High (bust point set at $3,120.00) Medium: (bust point set

at $1,560.00 ) and Low: (bust point set at $1,260.00). The following is a list of my methods

i.e. A B C.

Method A = High Risk:

1 1 1 2 3 4 5 6 8 12 15 20 28 50 | 50 28 20 15 12 8 6 5 4 3 2 1 1 1 = $3,120

Method B = Medium Risk:

1 1 1 2 3 4 5 6 8 12 15 20 | 20 15 12 8 6 5 4 3 2 1 1 1 = $1,560

Method C = Low Risk:

1 1 1 2 3 4 5 6 8 12 | 12 8 6 5 4 3 2 1 1 1 | 1 1 1 2 3 4 5 6 8 12 | 12 8 6 5 4 3 2 1 1 1 = $1,720.00

Basically, each method is a bet that is distributed over a series of hands. The idea behind

the sequence design is to give me the maximum amount of chances to net a small gain

(usually between $10 - $40 ) per session or more in the event of adverse losses that turn

around before or at the highest bet in my sequence. In other words, If am going to lose

the sum indicated at the end of each string, then that means that underlying math made it

impossible to put together two back-to-back wins in head to head play. Therefore, using

Method A, I give up after losing 28 consecutive attempts. When using Method B, I give up

after losing 24 consecutive attempts and when using Method C (described as low risk

because you are likely to encounter enough wins to make the loss less than the sum of

method B which is, $1,560) I give up after 40 consecutive losses. The bottom line with each

one of these methods is that they are structured in a way that I maximize my chances to

capture a win and when the math is against me, then my demise is delayed. The win

targets and con�dence levels for each method are as follows:

If win target is 10 units

Method A con�dence is 96% risk is 4%

Method B con�dence is 93% risk is 7%

Method C con�dence is 92% risk 8%

If win target is 20 units

Method A con�dence is 93% risk is 7%

Method B con�dence is 88% risk 12%

Method C con�dence is 86% risk 14%

All of the shoes listed in the next section as well as the methods, are derived from Method

A which is both high risk and high con�dence.

First we start with a sequence of 28 numbers in units:

1 1 1 2 3 4 5 6 8 12 15 20 28 50 | 50 28 20 15 12 8 6 5 4 3 2 1 1 1 = $3120

The rules for betting are as follows: (First 14 bets in the sequence 1 through 50)

1. Bet base unit if we win let it ride until next bet. If we win next bet then start over.

2. On loss, proceed to next number in the sequence and then apply rule number 1

The rules for the second set of bets in the sequence 50 through 1

1. Bet base unit, if we win, let it ride until next bet. if we win next bet in the sequence,

repeat rule.

2. On loss, go to next bet in the sequence and apply rule number 1

Remember, I recommend that each gambler develop a method that they feel comfortable

with and is appropriate for your bankroll. Also keep in mind that every method has a

nemesis that is, a shoe that when encountered will kill it dead which means you will lose.

This is because mathematically, no system can overcome losing a disproportionate number

of bets than you can win. Furthermore, when playing baccarat with any kind of method or

system it is not what happens as much as how that will determine your level of success or

failure.

Depending on your level and style of play, the best shoes will be those with high volatility.

As high-volatility produces a lot of data points. Shoes with low volatility produces less data

points and wider bankroll swings.

Mathematically speaking the key to winning Baccarat is your average wins have to be

greater than your average losses. The problem with this approach, is you never know

what kind of shoe you are going to get when you sit down at a table. Take for example,

two shoes I recently played. The �rst shoe had high-volatility and was an overall winner for

me backing banker the whole time. The second shoe was a big loser for me betting

banker the whole time. That is, my method failed because the two-count on my line was

low and sparse (spread out).

Let me explain how to read the data you are looking at:

Bet placement: Banker Line

Table Layout: 20 x 12

1. Numbers 1-20 are the hand numbers

2. Top line is banker events

3. Bottom line is player events

4. Vertical lines are Ties

5. Bolded items on the money charts are winning bets represented in units (all other

numbers are losses)

6. Blank spaces on the money charts indicates a winning hand but an unresolved bet. Lots

of these are good as they help to carry my money through the game and slow my

progression.

Casino: Rivers

Location: Des Plaines IL

Description: S1

Date: December 01, 2012

Shoe #1

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

X X | X X X X X X X X X

X X X | X X X X X

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

| X X X X X | X X X X

X X X | X X X | X X X

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

X X X X X X X X | X X X X

X X | X X X X X

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

X X X X X X X

X X X X X X

Money Chart for Shoe #1 (20 x 8)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

1 1 3 1 3 1 1 3 1 1 3 3 1

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

1 1 2 1

2

1 1 1 6 3 1 1 1 6

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

1 3 3 1 3 1 1 1 2 9 1

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

3 1 1 1 2 9 1 1

Session Summary Shoe #1 December 01, 2012

Banker Events 39

Player Events 31

Total Wins $720.00

Commission Costs $36.00

Net Win $684.00

Total Losses $330.00

Pro�t / Loss $354.00

The volatility chart show the swings in bankroll in terms of units (numbers on the left). The

numbers along the bottom of the chart shows the data points for volatility.

Rivers Shoe #1 December 01, 2012

Here’s an example of a shoe where I bust.

Casino: Rivers

Location: Des Plaines IL

Description: S2

Date: December 01, 2012

Shoe #2

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

X X X X X | | X X |

X X X X X X X | | X | X X

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

X | X X | X X |

X X X X X X X X X | X | X | X

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

| X | X | X X X X X | X

X X X | | X X | X X X |

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

X X X | X

X X X X X X X |

Money Chart for Shoe #2 (20 x 8)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

1 1 3 1 3 1 1 1 2 3 4 5

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

6 8 12 15 20 28 50 50 28 20 4

5

12 8

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

6 5 4 3 2 1 3 1 3 1 1 3

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

1 1 1 2 3 4 5

Session Summary Shoe #2 December 01, 2012

Banker Events 25 (11 ties against the Banker)

Player Events 37

Total Wins $650.00

Commission Costs $32.50

Net Win $616.50

Total Losses $3,130.00

Pro�t / Loss ($2,512.50)

As you can see from the charts above, a shoe with high volatility gives you the best chance

to win. Whereas, a shoe with low volatility can kill you especially, if you are betting on the

wrong side of the streak. A couple of things you can do when you think there is an adverse

run against you is simply try to wait it out. Your other option is to hop to the strong side and

ride the streak. The thing you will �nd di�cult is knowing when to do this and sometimes

a change to the other side will only result in additional losses as the shoe starts to balance

out. When in doubt, stop betting. Another skill you will need to master is knowing went to

get out of a shoe. that is, once you reach your win target you should quit. Of course you

can plot the numbers to see if staying longer would have resulted in additional winnings

but it is better to be safe than sorry.

Lesson 12

“Gambling is a hard way to make an easy living” -- Lem Banker

If you can master and put into practice the concepts I’ve talked about so far, then you have

graduated to the status of a professional gambler. Welcome to the club! Let’s talk a little

bit about what it means to be a professional gambler, like any profession, doctors,

law yers, engineers both mechanical and technical. These professions have several things

in common and that is, practitioners have deep knowledge about various aspects of their

chosen profession. But the really good ones have something that is far more important

and that is wisdom. The fundamental di�erence between knowledge and wisdom is

simple, knowledge is knowing what to do. Wisdom is knowing if what you should do is a

right or wrong decision in a given situation. Case and point, you are in a dark cave wading

through water. You have a book of matches and a candle in your backpack. If you can’t

see, the solution to your problem is simple, you take the matches and light the candle.

That’s knowledge. Take the same situation, but this time instead of water, the liquid

substance you are wading through in a dark room is gasoline. It should be obvious for a

host of reasons that the practical solution in this situation would be an extremely bad idea.

Therefore, those that recognize this are wise, and those that do not, well, they get the

darwin award. Professional gambling requires a few things, the �rst and most important

is emotional maturity and the ability to study and improve your performance. It also

requires you to be knowledgeable enough to know what you can and cannot change.

Furthermore, you will need the wisdom which only comes through direct experience to

not give in to your irrational impulses because as a professional gambler these failings, will

only make bad situations worse and cost you money unnecessarily. Now, if you have

aspirations to gamble as a full time profession, my opinion would be that your chances are

much better if you do it as a professional hobby rather than as a means of survival. This is

primarily because gambling is extremely risky, unstable and a scary way to make a living. It is

one thing to play a game in which one outcome is that you can win money doing it. It is

another thing to have your livelihood riding on the volatility constant exposure to a game

will yield. It is also di�cult to appreciate the psychological and emotional fatigue that

comes with the hours you’ll put in at the tables. Furthermore, if you are not using your

winnings to properly capitalize your bankroll because you are extracting money to pay for

life necessities what happens when you hit a downswing? Where is the money going to

come from? Gambling is a very slippery slope therefore, if you are taking money out

instead of building your bankroll, then you are putting yourself at risk of going on a tilt.

That’s why I say it is better to have another source of income as that will completely

reduce the stress of su�ering a downswing. Furthermore, the larger the bankroll, the

more decisions you can play and the only cash you should ever take out (especially) if you

are going to continue to play, is the money related to your net losses. Therefore, if you

want to beat the casino, use their money and your time to do it. You can also opt to cash

out at any point because one of two things will happen eventually, and that is, you will get

tired and quit or go broke. Here’s hoping for the former.

Chapter 9

The �rst 40 Hours of Baccarat

What follows is a summary of the �rst 40 hours (about 20 shoes) of Baccarat using Method

A which is high risk, and has a bust point of $3,120.00. This summary will cover 20 shoes of

live game play. The charts containing the distribution of events and completed money

sheets and volatility charts are contained in another book titled “Playing the Empire for Fun

and for Pro�t Baccarat The Long Game”.

It is true that gambling and investing in the stock market have a lot in common. Contrary to

the moral objections people have to comparing the two, the individual experiences in

terms of volatility and the cost or brokerage fees which grind away at your money, in terms

of individual experience, the outcomes are roughly the same, that is, most end up holding

the bag or getting wiped out during the downturns, those that have a long term view and

are properly capitalized survive for another round. A few win and win big, while the

majority jump in and out at di�erent points along the roller-coaster ride. The theory

asserts that investing is a net positive in the long term, whereas for gambling, the math

tells us that the long term prospects will result in a net negative. I think the key distinction

that is often overlooked is that of utility. Most regular people don’t have a lot of interest in

what happens over 100 years or billion baccarat decisions. What they really care about is

what happens in the short term and that time horizon is going to be di�erent for every

individual. When your money disappears in the stock market as it did in the 1920’s and in

the most recent downturn of 2008 and other busts, people will tell you, that you are not

giving it enough time. But if you are a net winner in gambling, people think you are fool

who is blinded by short term success. A curious position considering that both gambling

and investing deliver the same individual experience and that is, you win until you lose or

lose until you win.

When you gamble in a casino you are putting your money up for direct risk for gain. When

you “invest” in the stock market you are paying someone to gamble your money for you.

When you win, you win, and when you lose, you lose. In both cases, you have two types of

participants, those that take a measured approach, and those that go for the “quick kill”.

When you take a measured approach, you are subject to the same volatility, but your gains

and losses are more gradual and stay within a de�ned range. Which means, that in the up

swings you will never win as much as you could win. But it also means that in the down

swings, you will never lose a much as you could lose. Those that go for the ”quick kill” ride

the waves to the highest peaks but usually drown during deep downturns. Market

speculators usually experience a similar fate.

The following table shows the performance of one of my $20,000 investments in the

stock market over a 10 year period:

Year Investment $20,000

Starting Investment $20,000.00

1 $16,262.00

2 $20,865.17

3 $23,310.65

4 $24,886.33

5 $28,517.00

6 $30,356.60

7 $20,281.24

8 $26,302.74

9 $29,611.62

10 $28,725.90

Net Gain after 10 years: $8,725.90 which is an average appreciation of 4% per year. This

result was accomplished with no time investment on my part.

Volatility Graph for my 10 year investment

In casino gambling, you are constantly cycling money through a system that is not only

volatile but where there is a function shaving o� a �xed percentage of money with each

revolution. The following is a summary of the �rst 40 of 200 hours of Baccarat

performance. I bust once (shoe #18) for a setback of $2,314.50 which is a deduction of

about 9 games (18 hours of my time!) Without this bust, my gains after just 40 hours of play

would have equaled my 10 year performance in the stock market. However, when you

are gambling, you are risking 100% of a lot of money to achieve that short term gain.

20 Shoes of Baccarat

Total Banker Events 716

Total Player Events 656

Total Action (Money) $37,347.00

Total Wins $21,660.00

Total Commissions $732.50 (0.01%)


Net Wins $5,240.00 (14%) gain of total

From the above numbers we can get all kinds of statistics:

Average Action Per Game $1,867.35

Average Win Per Game Gross $1,083.00

Average Cost Per Game Edge $36.62

Average Loss Per Game $784.35

Average Net Win Per Game $262.00

Volatility Graph hours 1-40

Chapter 10

Hours 41-80 of Baccarat

The following table represents the next 40 hours of game play starting at shoe #21

through shoe #40. We bust twice once at shoe #30 ($782.00) and again at shoe #33 for

($1,081.00).






Total Commissions $1,214.50 (0.02%)










Chapter 11



through shoe #60. We bust once at shoe #43 for ($1,280.00)
















Chapter 12



through shoe #80. During this series we bust about 20% of the time which meets the rates

calculated for this particular method of play that is, we can succeed about 80% the time.

However, because I decided to use a high risk bet progression with a bust point set at a

little over $3,120.00, the lost shoes pretty much wiped out all of the wins from this series

leaving us near break-even. I bust in the following shoes: shoe #65 ($1,915.00), shoe #67

($1,068.00), show #72 ($1,550.00) and show #78 for ($1,006.00). The size of these busts are

about equal to the size of my net wins for the series and represents a setback of

($5,540.00). Here my losses plus edge account for 04% of my total action.








Net Wins ($949.50) 02% of total action





Average Loss Per Game $1,029.77

Average Net Win Per Game ($47.47)


Chapter 13


The following table represents the �nal 40 hours of game play starting at shoe #81

through shoe #100. During this series we bust twice in twenty games. Once in game #92

($1,107.00) and again in game #100 for ($301.00). Total action for this series is $38,230.00

we gave up $1,059.00 to edge which represents 2% of total action and we �nish with an 8%

gain $3,091.00.








Net Wins $3,091.00 08% of total action








Chapter 14

Betting Layouts

You should know by now that winning at baccarat takes more than just a system or

method which are nothing more than tools you can use to accomplish your goals. Winning

requires money, discipline, patience and the ability to accept occasional setbacks. When it

comes to betting systems, most are good for short term plays however, where they all fail

is that no system can overcome losing a disproportionate number of wagers. But how you

apply your money to the game has everything to do with the kinds of experiences you can

have. I saved the discussion of betting layouts as my �nal topic for several reasons, �rst of

which, I wanted you to have solid foundation as it relates to gambling and the risks

involved. The second reason of many, is that I wanted you to understand the dynamics of

the game. A lot of system sellers make bogus claims about their systems ability to beat the

game, the truth is there is no systematic or non systematic way to win. if you want to be in

a situation where you can never lose, then you have two choices, the �rst, is not playing

and the second is to have endless money. The �rst choice is self-evident, If you have

endless money, you will never �nd yourself in a situation where you cannot a�ord to make

a winning bet. The problem with this of course, is virtually everyone who plays the game

doesn’t have endless money therefore, they have to settle for a trade o� and that is to

use a betting system to apply money to the game systematically. The reason this would be

a trade o� and not a winning approach is if you had an endless amount of money you could

use just about any betting system you like and have a pretty good chance at winning. But

when you don’t have an endless amount of money, you are forced to apply your money to

the game in a way that gives you the most bang for the buck and there are several ways to

do this. Are there extremely poor ways to apply your money to the game? Absolutely!

Winning at baccarat requires three things that are peripheral to the game; bankroll, the

will to execute the required bets and the grace to accept the outcome. Most people that

lose all the time, come up short on one or all three of these areas. When it comes to game

dynamics, progressive betting is the most e�ective approach to take when managing your

money. The central idea of progressive betting is to always have some greater amount of

money to the right of zero than exists to the left of zero. As long as you still have enough

money to apply to the right of zero then you still have a chance to win. However, if you

don’t have enough money to apply to the right of zero then you lose. Sizing your bankroll

to your method of play is a very important aspect of money management and establishing a

method of play is a very important aspect of the game. When playing baccarat, you are

always betting for or against something, I call this your gamble. For each person the

gamble will be something di�erent. The simplest and most straightforward approach to

baccarat is to play one side banker or player where your gamble is disparity that is, the

di�erence between the two sides. If your side has a higher count at the end of the game

you win and if it does not you lose. How much you win and lose by will be a function of

your unit size and the total disparity. Disparity between hands will shift back and forth

during the game but the net result will range from 0 disparity to 2:1 or 20 points. Which

means that when you are on the right side, you can win a maximum of 20 points and when

you are on the wrong side, you can lose a maximum of the same. Therefore, take for

example a shoe where you bet bank every hand of the shoe from start to �nish and you set

your unit size to $40 to make every bet in the game, your bankroll would have to be 40 * 80 =

$3,200.00. If the �nal score of the shoe is Banker 46 and Player 29 then you Win ($588.00).

Here’s how:

Total hands without ties = 75 * $40 = $3,000 (action)

Total winning hands = 46 * $40 = $1,840.00 - $92.00 = $1,748.00

Total losing hands = 29 * $40 = $1,160.00

$1,748.00 - $1,160.00 = $588.00

If you were betting player every hand in this shoe you would be behind by -$680.00

With this kind of gamble your best and worse shoes are going to be those with double digit

disparity however, the vast majority of shoes will have a single digit disparity with the

average being around 8 points some shoes you will breakeven. This is an example of a

simple betting layout.

My favorite methods are all variations on the same theme, my gamble is that I will be able to

get two back-to-back wins in X number of attempts. Typically, I am betting for repeats.

Therefore, in terms of win/loss patterns LL = Loss and WL = Loss, only WW = Win. All of my

betting layouts are based on lengths that is, I am using my money to buy myself so many

attempts to encounter a WW. If I do not encounters a WW before I reach my last bet then I

bust. However, if I encounter a WW anywhere along my string of base bets then I make a

full recovery plus I net a pro�t. All of my betting layouts have coded names like SBR-430-10

which means Session Bankroll $430 Bust Point with ten total attempts. Let’s look at my

sequence of numbers in SBR-430-10 and then we can look at how it works:

10 10 10 20 30 40 50 60 80 120

It takes two hands for each bet to resolve. Therefore:

SBR-430-10

Bet No. Bet Amount Parlay Win Loss to Date

1 $10 $30 $0

2 $10 $30 $10

3 $10 $30 $20

4 $20 $60 $30

5 $30 $90 $50

6 $40 $120 $80

7 $50 $150 $120

8 $60 $180 $170

9 $80 $240 $230

10 $120 $360 $310

What my layouts all have in common is that there is an o�set between the base bet values

to make sure the parlay wins cover the LTD (loss to date). I reset on WW and begin a new

session. I keep playing sessions until I reach my win target or bust. I have layouts that

have up to 21 bets! For me, my methods contain the right balance of action and risk. I can

also switch between layouts dynamically if I choose. However, experience has taught me

that it is better to pick a layout prior to game play that gives a good balance between risk

and reward and run with that. I �nd that picking a layout with a run length of 14-15 is a

pretty good balance. This is because shorter run- lengths are subject to busting more

frequently and longer ones simply cause you to lose more money in long downturns. After

you play for awhile, you will get some pretty good ideas about what is best for you. All of

my layout are based on negative progressions which are dangerous in forward game play

for the following primary reason, when using negative progressions, you are raising your

bets in response to losses, in the hope that you will be able to score a win before your

money runs out. Another issue with negative progressions, is if you stop once you reach a

prede�ned win target, you always run the risk that you will give that money back + some

when you bust in forward game play. In other words, you win a lit bit slowly but you lose a

lot fast. A feature of my betting layouts is that they were all designed to compensate for

low hit rates that is you can play for a while without knowing if you will close a cycle a

winner or a loser.

A complete betting system is a combination of three key things and they are:

1. Bet Selection

2. Progression

3. Money Management

I have a baseline data set that I use to run my methods across for volatility testing that is, to

see how they hold up against 8,000 decisions or 200 hours of live game play. I run di�erent

methods across the same data to see the di�erences in performance of each method.

The �rst graph of each series shows bankroll �uctuations. The second graph shows per

game volatility in terms of wins/losses that is, how many times we were ahead or behind

and by how much.

SBR 430 10 10 10 20 30 40 50 60 80 120 is my weakest method and we bust a lot. We were

ahead 6% of the time and behind 94% of the series.

The next series of graphs show the performance of SBR-680

SBR-680 10 10 10 20 30 40 50 60 80 120 150 100 is a little stronger, we bust right out of the

gate. We were behind 81% of the time and only ahead 19% of the time during the series.

The next series of graphs looks at the performance of SBR-1260.

SBR-1260 10 10 10 20 30 40 50 60 80 120 150 200 280 100 100. This method spends 59% of the

series behind and 41% of the time ahead during the series.

.The next series of graphs looks at the performance for SBR-1420

SBR-1420 10 10 10 20 30 40 50 60 80 120 150 280 360. I use this method most often in live

game play. Here we bust out of the gate (shoe #2) and we spend 55% behind and 45%

ahead during the series.

The �nal series shows the performance for SBR-1760

SBR-1760 10 10 10 20 30 40 50 60 80 120 150 200 280 100 100 100 100 100 100 100. I developed

this method to see if I could improve upon SBR-1420. The numbers got slightly worse! 57%

behind and 43% ahead.

The mathematicians are absolutely correct about the long term negative expectancy of

the game. However, by simply bailing every time we hit +20 in a shoe, our ratios of winners

to losers goes up signi�cantly. The downside, is that if we are playing SBR-1420 we give up

-140 units each time we bust which sets us back 7 games worth of gains. The data also

proves that my winnings were largely the results of playing a series where the composition

of shoes encountered in live play produced positive results but there was an equal chance

for them to be negative also. To illustrate this concept, let’s look at what happens when

we �at bet the same series.

The next set of graphs will examine what happens when we use positive progressions

against the same series. With positive progressions we basically reverse the polarity of the

outcomes that is, we sacri�ce series of small losses in exchange for a large payo�. The

gamble with this method of forward play is that we will be able to score enough big wins

often enough to o�set the number of smaller losses we will end up taking. The game

dynamics can make this method of play a net negative in the long run. However, if you love

the game as much as winning, both approaches are fun to play.

When using method 1-3-2-6: 10 30 20 60. This progression is executed by going to the right

for each win but returning to the left on any loss. We spend 6% of the time behind in the

series and the rest of the time 94% ahead.

The method I am going to use to play my next series is called SBR-3020 and it is a six level

positive progression: 10 10 15: 20 30 45 : 50 60 80 : 100 150 200:250 300 350: 400 450 500. Here

are the results.

Here’s the volatility chart for SBR-3020.

My next method is SBR-4150. 10 30 20 30 40 60 80 120 160 200 250 300 350 400 450 500. This

progression is a little more aggressive, but really shines when there are positive streaks.

Here are the results from our 8,000 hand series. We were behind 1% of the time and spent

99% of the time ahead.

Here’s the volatility chart for SBR-4150.

As with all betting progressions, you have to be psychologically prepared for the down

swings. When using a positive progression you don’t risk going broke from a bust out, but

rather, it is death by attrition as long losing streaks can grind away at your bankroll.

Overall, positive progressive betting o�ers the best bang for your buck when playing a

game like baccarat.

To understand better why progression don’t change or a�ect the underlying conditions

notice how similar the following graphs are to all of the ones shown so far. The following

graphs represent the underlying volatility of the series when no progression is used.

SBR-FB-10 this method contains one bet $10. With �at betting we spent 23% of the time

behind and 77% of the time ahead. The negative progressions in their attempts to stay

ahead cost us so much money during the busts that we spent a signi�cant amount of the

series trying to recover. The positive progressions basically grind along in place during the

down trends and take o� during the up trends.

Here’s the volatility chart for SBR-FB-10.

My next series of graphs shows the results for 8,000 additional hands of baccarat. Overall,

the series is more balanced. We examine the performance of the following betting

methods:

1. SBR-FB-10 (Flat bet banker only)

2. SBR-120-1326 (Positive progression banker only)

3. SBR-3020 (Positive progression 10 10 15 20 30 45 … banker only)

4. SBR-4150 (Positive progression 10 30 20 30 40 60 80 … banker only)

5. SBR-1420 (Negative progression 10 10 10 20 30 40 50 60 80 120 150 200... banker only)

6. SBR-4150 (Positive progression same as number 4 player only)

There will be two graphs for each method, one will show the overall bankroll volatility and

the other will show the win/loss volatility.

In this series we spend 7% behind and 93% ahead. By simply backing the banker we win the

series.

When we use the SBR-120-1326 on the same series we get the following results.

With this method we spend 6% of the series behind and 94% ahead. The next graph shows

the volatility for this method.

A lot of players don’t like this method because in forward game play, you ping pong around

in this series we lose all of our winnings half-way through the series.

With SBR-3020 we spend 6% of the series behind and 94% ahead. Whenever we encounter

winning streaks we see huge jumps in fortune. But you will also notice that we are largely

losing ground between those peaks. This is because we are reversing the polarity of

outcomes.

Notice how the volatility chart mirrors the overall bankroll chart.

With method SBR-4150, we spend 5% of the series behind and 95% ahead. Due to the

aggressive nature of the progression, we really peak on winning streaks. But, we also lose

ground pretty quickly between them.

Just for comparison sake, I wanted to add a negative progression SBR-1420 to the series to

see how it performs. The next two graphs show this.

With SBR-1420 we spend 64% of the series behind and only 36% of time ahead.

Finally, let’s look at what happens when we back the player only using positive progression

SBR-4150. While you don’t pay commissions on the player bets, there is an edge buried in

backing the player hands over the long run.

While there is an initial peak for player wagers, the overall slope for this series is negative.

Overall the player loses more bets to the banker. Which is why if you want to lose the least

about of money, you play the side that has the lowest house edge and that is, to bet with

the banker. In my next book Baccarat the Long Game , we will start with an analysis of

SBR-4150, how to setup your card for managing your money in forward game play using

method SBR-4150, how to read compressed shoe formats and a walk through of 100

shoes recorded and played at Rivers Casino in Des Plaines using this method for the entire

series.

Thank you for taking the time to read my book, I hope that you found the wisdom imparted

here useful.

About the Author

http://baccarat.leeware.com/btlg.html

Lee Evans is the former Owner/Operator of LeeWare Development an Information

Technology services company. With more than 20 years in the business, he currently works

as a Senior Level IT Consultant for the Private Security Industry and Several Technology

Related Businesses. Much of his prior written work is on the subjects of Technology and

Sociology. He is 41 and resides in Schiller Park, Illinois and Baccarat is his favorite Casino

game. You can reach him by email at: [email protected]

mailto:[email protected]

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Lee Evans 2012 Baccarat Playing The Empire Fun And Profit