Thinking in bets

World Poker Champion Annie Duke explains what a bet is:

…I have options that I’m weighing…

And I have limited resources to invest, so I can’t invest in all the options available to me…

Let’s simplify it and say I’ve got:

  • a binary choice: Option A and Option B
  • resources to invest (sometimes it’s just my time)
  • when I choose an option, a set of possible futures that could occur, and each of those futures is going to have some probability of happening (whichever option I choose, it’s not going to result in a guaranteed future)

I invest in an option that then results in some sort of probabilistic distribution of outcomes, and what I’m trying to do is get a positive return on my investment.