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Ask HN: Why doesn't somebody buy every combination of the Powerball?
10 points by hanniabu on Jan 10, 2016 | hide | past | favorite | 15 comments
With how big the powerball is, it now seems feasible for somebody to buy every combination and still come out in the green.



Here's the math for those wondering:

Odds to win = 1/292,201,338

Cost of Ticket = $2

Buying All Combinations = $584,402,676

Current Prize ~ $1,300,000,000

Takehome Annuity(1) ~ $900,000,000

Lump Sum Takehome ~ $550,000,000

You'll likely end up splitting the prize at this point with at least one other ticket which will put you in the red by over a hundred million. This is the primary deterrent.

1: After 30 years of payments. 900m is lower end after state taxes. https://www.usamega.com/powerball-jackpot.asp


You would also need to buy about 900 tickets per second from the moment the first drawing is over until the second one begins, hoping all the time for a rollover.


I have always wondered if the odds of winning is true as stated. If it is so difficult, how did Joan Ginther win it four times? Per the article, Why would Joan Ginther, a math-savvy woman with a Ph.D. from Stanford, leave her home in Las Vegas, a block from three casinos, to devote countless hours to lottery longshots

if she can be considered a legend then someone can do it with powerball?http://www.philly.com/philly/news/nation_world/How_lottery_l...


What about all the small prizes that you'd win as well?


This strategy makes sense when the odds of winning are known, and the jackpot is not shared.

The powerball jackpot is shared so you would need to factor in the likely number of people you would share with which would be complicated to figure out.

There are cases in gambling where the jackpot is not shared, for example poker machines.

The odds of winning remain fixed, yet the jackpot slowly increases, moreso when there are many machines linked to build the same prize.

At a certain level of jackpot the math works out and it's a sound strategy to pour money into the machines.

See: break even point https://en.m.wikipedia.org/wiki/Progressive_jackpot

Here's a person who's written about dedicating their life to this approach: http://www.amazon.com/Million-Dollar-Slots-Peter-Liston/dp/0...

If you were going to invest in lotto with shared jackpots I've heard anecdotes that choosing numbers 32 and higher is a better way to go because people tend to pick birthdays. I think looking at past drawing results and whether there was a winner or not you could analyse if numbers are picked disproprotionately, but I'm not sure what sample size would be needed to generate meaningful results.

All that said, I can think of many things I'd rather develop expertise in than reverse engineering the payout odds of poker / progressive jackpot machines.


Asked and answered a couple times, but here are the highlights.

1. Possible splits: should you win and have to split the pot you would probably lose a large amount of money.

2. Timing: You can't purchase the tickets fast enough. Say, for example, you wanted to purchase all of the tickets. Even if you purchased a new ticket each second, with only 86,400 seconds in a day and 292.2M outcomes, it would take you something like 5.5 years to fill out all of the tickets.


A group attempted this in a state lottery which I saw in a documentary about it a long time ago. There weren't even close to the numbers or potential gain involved in the Powerball and needed a fair bit of luck rather than all the numbers, but still they profited big. Back then I think the problem was that they couldn't print and submit the paper lottery tickets quick enough to get all the numbers, so ended up just chancing it. I guess using the internet these days should make it quicker, but still, in the UK last weekend the online demand for a £50m prize lottery managed to shut down the online site.

Some discussion of the state lottery win on reddit: https://www.reddit.com/r/todayilearned/comments/1t8ool/til_i...


What if another random person wins it so the jackpot is shared?


As a historical aside, the French mathematician Charles Marie de La Condamine (with the help of some guy named Voltaire) did almost exactly that in the 1720s:

http://www.damninteresting.com/the-enlightenment-guide-to-wi...


First and foremost, it would take more money to buy all the combinations than the payout. Also, while $1.3 Billion sounds like a great big number, when you consider the taxes (even with a good tax attorney you are going to pay a substantial tax on that number), and whether you would take that as a lump sum or annuity, other factors come into play.


How much in losses can you write off from the losing tickets against your winnings?


At that level, probably none:

http://www.fitz-cpa.com/gambling.aspx#GM7

Once you are in AMT territory, you lose the deduction.


Because there's a limit to how much most people can spend.

It's why the martingale strategy sounds ok in theory but fails in practice. You don't have infinite money (plus most tables have max bids too)


you would have better chances starting your own startup


And break even if no one else wins?




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