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Understanding Game Theory on the Horse Race Tracks

After learning about efficient markets in the classrooms, on 28th Nov. 2017, SP Jain’s BEC students at Dubai headed out the Horse Race Tracks to see if the efficient market theory works.

The students also learned the application of game theory at horse race. Game theory deals with numerical and probabilistic analysis to help calculate and perhaps devise a way of maximising or optimising the expected returns. Based on the betting odds and other information from the gambling game, the students performed an analysis of expected returns from betting on the winning horse and came up with a strategy.

Horse Race Tracks

Visiting the horse track helped the BEC students learn a great deal about behavioural finance and probability. The 'worst' horse (as per your analysis) could win the race while the likeliest winner may come dead last. One may bet on a horse with the lowest odds (therefore most likely to win), but may still end up losing - some insights better understood on the tracks than it could ever be inside a classroom.

* This Event Update has been written with inputs provided by Shreeya Khetan (Student, BEC Program)

Topics: Global Learning at SP Jain, Dubai