How to win the lottery according to math. Visit lotterycodex.com/how-to-win-the-lottery-mathematic…
When playing the lottery, it’s important to understand the concept of expected value (EV). The EV is a gauge that tells you whether the lottery is profitable. For example, if the EV is positive, it means that playing the lottery is likely profitable, while a negative EV means that it is not profitable.
Let’s take the Powerball as an example.
When creating this video, the Powerball is at an estimated jackpot of $384 Million. Therefore at $2 per ticket, my calculation for EV is a negative $0.37. It tells me it will not be profitable when you play Powerball at a $384 Million jackpot prize.
At the 1.5 billion mark in January 2016, the EV was a positive $3.45, indicating that playing Powerball at that time was likely to be profitable.
While a positive EV is a good signal for buying lotto tickets in theory, in practice, it doesn’t always guarantee positive returns. Other factors such as taxes, the annuity, the cash option, and the possibility of splitting the jackpot prize can all affect the EV and lead to a negative expected value.
In short, a positive EV in the lottery doesn't happen. Realistically, the lottery always yields a negative expected value. Therefore, playing the lottery should never be considered a substitute for a real job to earn a full-time income.
The lottery is a gambling activity and should only be considered for fun and excitement.
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