Quote Originally Posted by Stolly View Post
Chucking in my twopence worth, I too am a financial adviser . Theheathens explanation may be long winded but its bang on the money. Think of diversification as improving the odds but lowering the maximum payout. Betting on black in roulette is a more 'diversified portfolio' than betting everything on zero
Right so if it's improving the odds it's a gamble, which is exactly what I've been saying. If you knew the number 5 was going to land on the next spin, you wouldn't put your money on 5,6,7,8 and 9. So diversification is a tool of impotence and ignorance.

Besides betting on black doesn't give better odds in the long run. In the long run the person betting on black(diversifying) will lose exactly the same amount of money as the person betting on zero(not diversifying). This is the gamblers fallacy I mentioned.

The person gambling on black will also find that when zero comes in he loses half his money.