marginofsafety

Hmm I think you missed out a very impt point here. Probability of winning cannot be viewed as a standalone. You have to compare it vs the odds you're getting.

Lets say I offer you a coin toss gamble. Heads I win, tails you win. But what if I tell you if you win, u get $30 and only lose $10 if it lands on head? As you can see, this makes it a positive expected value proposition for you and one that should be taken every single time when being offered.

You might even realise now that this applies even to a gamble that you only have 10% of winning if you have the right odds.

But of course, the pre-requisite is that you have to estimate correctly the % of you winning since the odds are being given to you all the time in the form of stock price etc.

Li_Guang_Sheng

Reply to @marginofsafety : Agree. Thanks for adding and making it more complete. Forget to add on the odds. I assuming is common sense if the probability is 50/50, the pay out is 1 is to 1. If the probability is 50/50 and you get way less then 1 to 1, is suicidal. Just like in casino, there are a lot of people aiming for high odds, but usually the house edge is way super high. It is detrimental to bet as long run odds against you despite the odds being high. Thanks pal for sharing and analysing.

CslowCslow

$Hong Leong Asia(H22.SI)
cimb and lim & tan buying at 1.19

Li_Guang_Sheng

Same sharing, probability is important in investing. Like for RE and S, I suspect around 10% chance of getting, but I apply 10 times and get once and I can get back my $20($2 x 10) investment. But I do not try I do not have hope and better chance than Toto and 4D. And if experience enough, you only apply "good" IPO that if get make money. My definition of "good' IPO is one that if I get I will most likely make money on opening (bearing unforeseen black swan events). Thanks.

Sporeshare

Reply to @Li_Guang_Sheng : Ok noted thks ! Looks like Sti is going to breakout 3400 soon

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