Your Transformation Station - 4. Professional Gambler David Marut on Roulette’s Law of Three

Episode Date: February 20, 2020

Roulette looks simple on the surface — a wheel, a ball, and a bet. But beneath the spin lies a world of behavioral patterns, probability traps, and emotional decision‑making. This week, professional gambler David Marut sits down with Gregory Favazza to unpack the deeper mechanics of the game. Marut introduces his “Law of Three,” a method he uses to observe patterns in roulette outcomes and the social behavior of players who believe they can outsmart randomness. Together, they explore: Why humans search for patterns in truly random events How casinos leverage psychology to keep players engaged The emotional highs and lows of gambling The difference between probability, perception, and superstition What roulette teaches us about leadership, risk, and self‑control Whether you’re fascinated by gambling, psychology, or the way people behave under pressure, this episode offers a rare look into the mind of someone who studies the numbers — and the people behind them. Connect with Gregory Website: https://www.ytsthepodcast.com Apple Podcasts: https://www.ytsthepodcast.com/apple Spotify: https://www.ytsthepodcast.com/spotify YouTube: https://www.ytsthepodcast.com/youtube  Facebook: https://www.ytsthepodcast.com/facebook Instagram: https://www.ytsthepodcast.com/instagram TikTok: https://www.ytsthepodcast.com/tiktok X: https://www.ytsthepodcast.com/x  LinkedIn: https://www.ytsthepodcast.com/linkedin Learn more about your ad choices. Visit megaphone.fm/adchoices

You have to have a definition of success. If I could go back, there's not many things that I would go back for, but... What do you do when you lose your purpose? It's okay to struggle. It's okay that you're not okay. I am your host, Greg Favaza. Together, we will go on a journey. This show is all about surpassing our internal dialogue.

rediscovering your true identity, honing new foresight. We have a chance to make the world a better place for our children. Start living in the example today and become your future self tomorrow. If you can leave our viewers with some good advice to follow, what would you let them know? These things that you're afraid to do, go do them. You need a bankroll of $1,000. Well, I don't have $1,000. to throw at, you know, gambling.

So I've kind of looked at different strategies, different concepts, money management, and put them together into some ideas that I have of my own. And it's something that I'm obviously working on trying to make it so that, you know, the average Joe can go to the casino or get online and throw a couple bucks at it and give a shot. That was David Merritt. Welcome back to Your Transformation Podcast, and I am your host, Greg Favaza. And that is our guest today.

We have David Merritt. he looks into the probability of roulette and making it a fair game against the house. This is a really good episode. If you have not subscribed to the show, hit that subscribe button. David, welcome. Welcome to your transformation podcast. David, let's jump right into this. How did this all start?

Yeah, absolutely. Thanks for having me on the show. I really appreciate that. It's kind of a combination as of everything that I've studied from everyone else's attempts to beat the casino, if you will, you know, and develop that strategy that will take down the house and fill your pockets full of money. And so I've kind of looked at different strategies, different concepts, money management, things like that, and put them together into some ideas that I have of my own. And of course, studying the game of roulette

itself, not just the strategies, but the payouts, the layout, how the game works and how it operates the inconsistencies in it, but the actual consistencies that you can still find. And I just, I've always loved numbers. And, of course, studying the game of roulette itself, not just the strategies, but the payouts, the layout, how the game works, and how it operates, the inconsistencies in it, but the actual consistencies that you can still find. I don't know, I came across roulette a little while back. I attended an old Robert Kiyosaki event.

We looked into it a little bit as understanding. the roulette a 50-50 between the two, but which makes it the house a slight game of 47% of 53? What was that? What was that number? 47. Okay. You got it.

That's the key right there. I'm not sure. Those numbers are really relatable with the stock market. I'm 100% on those numbers. You were spot on. What they were saying is exactly right. And I think what they were trying to do is equate that to how the stock market works. And there's a lot of people out there.

including myself that at one time when I was playing around with the stock market, I actually invested based on what I saw in the graph. It was kind of, it's kind of the track record of the company, or not necessarily the company per se, but how the company was doing on the stock market at least, right, how the investors viewed that stock. And so you could see trends in the rise and fall of the line graph or the candlestick graph as they sometimes use. And so like if you were to see a spike with a certain number on a roulette table, you would then realize, hey, at some point, this area of the table or this number is going to come back down to, you know, the regression to the mean, if you will.

So, David, tell me this. How do you think people see the difference in investing and gambling? The difference that people look at with stock market versus gambling, sports investing, or betting is what they call it, is that, you know, they frown upon the gambling and sport betting because it doesn't seem to have that same aura of a business suit, give your money to someone that they can manage and invest in the companies because they can look at the companies, do research, data collection, financials and all this and say, hey, this looks like a solid company, let's go with it. Okay, but you and I can both agree that that's still a risk.

I mean, you look at a company or business and you can do some research on it, right, and say, my example is Chipotle Mix can grow because I actually did do some investing in that company. And it's a great restaurant. I loved it. I think it came to the East Coast where I was in college at the time around 2001 or two. And so I was like, it just fascinated me. This place you can come in, get great food quick, sit down and eat. And it was delicious, cost effective.

And it was great. And that for sure was a business. I thought, hey, let me tell my grandfather about this one. So we got talking about it, invested in it, made some money on it, which was great. But it still is a risk. to put money down on a business and hope that it succeeds, right? No, no. So I get what you're saying as far as it's, there's no guarantee with putting your money

in the stock market. And that's my point. And so when people come to me and say, oh, well, gambling, got to be careful with that. And I was like, sure, but you don't feel the same way about giving money to someone you don't know to manage it for you that's going to, you know, put it down on a business and take a risk that it succeeds. So that's kind of where all this started for me. And then, of course, I just, as a curious person, I'm always trying to make everything better, right?

How can I make it faster? How can I make it better? And so it led me to this gentleman that I came across his YouTube channel. You all can check it out. Great guy. He's the goal 60. And that's his YouTube handle there. And he's a great guy.

He's very open. He's kind of has a similar heart that I have, which is if and when I do come across this Holy grail of betting strategy or sports investing strategy. I want to share it with people and give them the chance to be able to also hopefully become successfully successful financially. So I came across his page and I'm just watching his videos. I'm kind of like, I'm really intrigued. He's got something going on here that seems good. And basically what he had was a chase betting system on baseball games. And in the baseball season, you've got every team plays pretty much, anytime they play another team, they play them for two or three, maybe even four games straight. So it provides an opportunity

for you to take a look at both teams, study them, look at all their data, the batting averages, the pitching, everything, and say, hey, I think that this is a good value on this team. I'm going to invest my money on this team to beat this one. The good thing about the system is if you lose that, first initial game, they play again the next day, right? So you can jump back in and with a good money management strategy, you put more on the next bet, and then it wins back any losses and you have a profit as well. So you just keep chasing it. Yeah, it's called a chase betting system. And it's something that I really, it was kind of my first overall strategy that I looked into and thought, man, this is brilliant. I wonder if I can use this elsewhere. If you know anything about gambling,

you've probably heard of the Martingale strategy. No, I haven't. Okay. So the Martin Gale betting strategy is where if you put down a $5 bet on, let's talk about roulette real quick, you have red or black, right? So you put a $5 bet down on red, but black comes up. So you lose your $5, right? Well, the Martin Gale strategy tells you to double up. So you go from $5 to 10.

So now you put $10 down on the red. and if it wins, you win your money back that you lost and a $5 profit. And you just continue to double up on every single loss that you have until you finally get a win. The problem with that is the Martin Gale strategy can be quickly, like it's nobody has an infinite amount of money, right? So at some point, you're going to have a last bet and run out. You know, you go from 5 to 10, 10 to 20, 20 to 40, so on and so forth until it's like tens of thousands of dollars and only 13 or 14 bets in, I think it is. So it doubles and accumulates very quickly. Me being an inexperience better, that would make me nervous.

What about your intuition? Is that going to be beneficial when you're applying this system? The thing with that is sometimes honestly intuition can help. But what I'm trying to do is create a system that takes intuition and all of that out of the equation. Literally is like, as you and I know, two plus two equals four, right? Well, if you were to take out that one of those twos, and it's like two plus X equals four, you can do the mathematical equation to find out what X equals plug in two. Well, I kind of want to create, and that's what I'm working on, and I think I'm very close to creating exactly that, where when you see a certain scenario, you can do a quick little, hey, hey, hey, this is coming up, you know, for lack of a bitter term there, hey, hey, hey, hey, hey. My indicator just happened.

And you know where to place your bet and how to. What should I do first prior to implementing this system? So you go about it in a smart way. Okay. So you do your research. You collect the data. You study it. And then you place your investment, right?

So I was really intrigued by what the Gold 60 had on his page there. I was watching each video or going through it. And it kind of led me to think about, hey, there's X amount of sporting events. For him, it was baseball. that we were working with together. And it was baseball. And they played only, I think it was like 13. There's a lot of opportunities to make money and invest your money on each game each day.

But I wanted more because each game took, you know, three hours to play. And if you lose, you have to wait until the next day, 24 hours later to invest with your money management strategy, to win it back and get a profit. It just, it took too long, which that is what led me to the casino. And I saw a documentary on what's known as a bias wheel. This gentleman in Monte Carlo, he discovered, he's like, hey, there's got to be a way. And I think we all have this. There's a fixation on how can we take down the house? How can we beat babies, right?

Well, this guy did it. I don't remember his name, forgive me, but he was from Monte Carlo, and he went to the casinos there and studied the wheels. And he started collecting massive amounts of data. He would sit there for hours upon hours. And actually it got so much, it got to the point where he was spending so many hours in the casino. He needed help. I wish I was kidding, man.

I'm not. Wow. Cousins, brothers, uncles. He called family and said, hey, I have an idea. I think I have come across something, but I need your help. And they bought in and they decided to help them. So they all individually went into the casinos, placed very nominal, nothing, like no bets, very little or no bets.

It was mainly about collecting data. So they wrote down a number seven came in, number 31 came in, and wrote it down and collected all this. They got together, put it all into a computer spreadsheet, and then the computer analyzed all the data and told them the number that came up on each wheel the most and how often pretty much on an average that that number would come up. So they realized that there is something called a bias, which just means that the wheel might have, I don't know, a dent

in it while the ball's going around, it hits that dent. And for some reason, when it hits that dent, and it's not on any other wheel, right? It was created by maybe a dealer bumping it or something. Who knows? But now the ball and the wheel spin together and land in a pocket more often than any other. Let's pause for a second.

When you said a dent in that, like chipped on the wheel, like can you go into that a little bit? Sure, absolutely. What they were noticing is that when a wheel gets used in a casino. Over time, you have wear and tear. Like any machine it wears and tear. You have to get an

normal change in the car and all that. Well, the roulette wheel is no different. So the ball will span and spin and spin. And then there's these little they're like little speed bumps almost, if you will, right? And the ball hits them and starts to like rattle around and then land in a pocket with a number associated with it. And

it's those little bumpers or speed bumps on the wheel there that can wear down over time with the ball hitting it, X amount of times more than maybe the other side of the wheel. And so it's hitting it. Yeah. So if it hits it enough, it's kind of like that persistence.

It's what's that saying? Like persistence will get you through, right? I don't know what the saying is. Come on, bear with me here. But basically, like, even water can cut through a rock with a constant drip, right? We've all known that. You know, just drip, drip and over time, it wears away at the rock. Well, same thing with that ball spinning around on the wheel.

It'll hit those bumpers and create little indentations or dense. on them over time. And so depending on how often and, you know, whatever with the ball hitting that bumper, it can cause the ball to react in such a way that for some reason or other, don't, don't ask me, but the ball lands in one pocket more often than another. And for them, they noticed that I believe it was the number six. If I'm not mistaken, the number six kept popping up over and over and over again, like quite often. And so with all their data collection, they decided to pull their money together. And they said,

we're going to, we're going to keep an eye on this wheel. And they knew where any little mark was on it or whatever so that the casino, whenever they moved that wheel to a different table, they still knew which wheel it was. Sounds like it's a bank robbery, just taking it down for millions. That's correct. They took it down for millions, so much so that they were banned forever coming back in. and they end up having to like try their luck overseas here in Vegas and Atlantic City and whatnot. So it's quite a story. But I kind of believe that it can't be the only way that roulette can be beaten. That is what kind of has encouraged me to take all the little bits and pieces of everything I've ever looked at, studied, read about watched on YouTube or on documentaries.

For the roulette's bets payout and probability, would this work for? American or European? And what's the difference? Well, the probabilities are slightly different because you have American roulette is in case for those that don't know has the zero and double zero. So two green numbers. European roulette has just a single zero. So one green number. And it's those green numbers that give the casino the house edge. So I would only recommend playing the European roulette game, not the American roulette. The double zero and zero give the house another, well, it's not another. I think the total is like 5.26% edge over you. And the European roulette is only 2.6 something, I believe. So it's better to play the roulette game than American for sure. Interesting. So if we were to go into the numbers a little bit.

Yeah, they gave you American roulette. So I can give you the difference in numbers there. So, African roulette, it'll be 47.4% winning. And for European, extra 1.2% house edge for American roulette. Let's do the easiest example, which is probably your outside bets. Okay, those are your 50-50 or what most people would consider your 50-50 bet. So before we talk about roulette, let's do a very small, simple example. again trying to break down

something complicated to something easy to understand. A coin has two sides, right? You have heads and you have tails. You have exactly a 50-50% chance that it would land on either side, right? There is no, I mean, unless for some crazy reason,

it lands in a crack and it's like standing on its side. That's the only way that could happen. So we all understand that's an exact 50-50 chance of winning. There's no other option. with European and American roulette, they have that little green number. For European, it's a single zero. For American, it's zero and double zero. So two numbers.

That actually, that's what gives the casino a house edge. So if you are going to bet on red or black, most people would think 50-50 chance. They're close, but they're not accurate. The casino pays out 50 to 50, but you don't have an actual 50-50 percent chance. chance. For American roulette, it's 47.4% chance of winning on red or black. And then for European roulette, it's 48.6, which is a difference of 1.2% more in the house edge, more in favor of the casino for their house edge. So that's why I would say only stick with European roulette. That little 1.2% over time will eat away at your bankroll and the casino will just take all

your money. One other way that the casino actually has a house edge over you is that the payouts are not what they should be. So, for example, if you were to take a bet and put it on, let's stick with the number six from my example before, if you took one chip, one dollar chip and put it on the number six, and you win, the ball actually lands on number six, you only get paid out 35 to 1, but we already discussed earlier that there's 37 numbers on the table. Another way that the casino kind of takes money from you slowly but surely and gives them that house edge. They should pay you out 37 to 1, but they don't.

They only pay out 35 to 1. Extra numbers are the 0 and then the double 0. So that makes, that's what American is 38 numbers total that, you know, the ball could land in 38 different pockets. And European roulette is 37 different pockets. It's just that green single zero. The roulette, bets, pay out, and probability. And you implemented your own little twist, which end up being a huge positive for you.

Can we go into this? Yeah. Yeah, it's something that I came across in my research. And I didn't mention this earlier, but during all the time that I'm trying to collect data and study this and everything, I came across, you know, like anything, you have people that are trying to monitor. systems and whatnot, right? And so I came across a software that you had a monthly subscription, you had to pay to use it, and it claims you could make all this money and, you know, hundreds of dollars an hour. And man, it sounds too good to be true. Guess what? It probably is too good to be true. Plus, the other reason that I just don't, I don't have the money to spend

$150 every month to give them on something that you don't know if it really works or not, right? They're telling you it is, but that's the salesmanship. Exactly. I get those in my email every day coming through. That's right. Actually, coming across that software, I was interested as to, like, are they going to explain anything to me? Like, to hook me in and believe them that it works, what is it that is going to make me click and buy in, right? And so give me something. So I look it up.

And they talk about this law of thirds, which makes perfect sense when I continue to read about it, study it, and then. test it. And the law of thirds basically states that it's basically impossible for the roulette wheel, as roulette it could be pertain to anything, but on the roulette wheel, we'll stick with that. There are 37 possible pockets for the ball to land in. If you were to spin the ball 37 times exactly one for every pocket, would the ball land in every single pocket once before we start getting into a second round of 37 more spins. The answer is no. It's just,

it just has probably never happened. By that, what I mean is, okay, so with craps, let's do that real quick. You can roll what people call snake eyes. You have the one and the one, so two.

You can roll, then it would be three from there, and there's two combinations and ways to roll the number three, and then you have the number four, and there's three ways to roll the number four, and so on and so forth. But if you took the dice and rolled them,

you're not going to get snake eyes first, Okay, and if you do, I guarantee you you don't roll a three next. And then if you try it, I guarantee you don't roll a four next. Like, you're not going to get it in sequential order like that, right? What you'll find are repeats before every slot or dice are rolled. Again, I'll try to bring it down to simple terms here. If you put 37 marbles, you have a bag of marbles and they're all labeled one through 37. You have marble number one, number two, so and so forth.

if you were to reach your hand in the bag and pull out one marble at a time, the first time you reach in, you pull out marble number seven. Second time you reach in, you put that marble back in, right? Number seven goes back in the bag, you mix it up, and you reach in again. The next number, let's say, is 13. All right, so you had seven, now you have 13. If you were to reach in and pull out a marble 37 times, do you think that you would pull out one through 37 individually,

at least once every single time. In other words, you're not going to reach in the bag 37 times and pull out all 37 numbers. You're going to have some repeats. What the law of thirds basically says is that you will get about two thirds of those marbles pulled out. Right.

And they'll be put back in, but I mean, they'll be marked. Like you pull out seven and you write down seven. Okay, you keep that for data. You put the number seven back in. And, um, sorry I did that. apologize.

But you put the number seven marble back in and you mix it up and you're reaching again. By the fifth, sixth or seventh time, you'll probably get a repeat. You might pull out that number seven marble again, right? And so with those repeat numbers,

it means that basically you're going to have about a third of the marbles, the numbers on the marbles, not picked out. After you pulled your 37th marble, you reach in 37 times. After you've done that, you're going to have some marbles that never got pulled out. and the law of thirds basically states that you are right around a third of those numbers that didn't get pulled out that are still left in the bag that were never seen.

So what we do is we take that philosophy or that law and we apply it to a game or a strategy to give us an edge of some sort. Because unlike Blackjack, for example, if you're a card counter, you're sitting at the table and you're, and you count each card has a value and you count it in your head you know keep tally on that and you're halfway through the deck and if you're a good card counter you can probably tell me tell me how many face cards are still left in the deck versus you know how many are have been used right so you have an idea of what is still to come but that's because each event is connected to the previous event so the cards get dealt and they get pushed to the side they don't get shuffled back in the deck, right?

Yeah, that makes sense. Okay. Now with Roulette, though, the ball goes into one pocket and picks one number, and that's the result. But that number doesn't come out. It stays there. So the ball goes around again and could still land in that pocket again, right? Mm-hmm.

Okay. So that is what's known as an independent event. They have no connection from the previous past. So Roulette loves to show you a usually 10. to 12 number history of what's coming up because the casino knows that we're going to look at that and say, oh, a lot of reds are coming up. It's going to be black next. Well, that's not a guarantee, right? I mean, you have about 50, 50, 50, excuse me, about 50, 50 chance of that happening one way or another. Each time you go, there's always a 50-50. And a lot of people

like to forecast their next odds based off their past behavior. Is that correct? That is correct. And though that seems silly in a lot of people's eyes, it actually can, it is proven to be true where, depending on how you apply that data, it can give you some sort of forecast of the future, even from independent events. So we look at the last, let's say, nine numbers, right? And if those nine numbers,

if there isn't a single repeat in those nine numbers, then you know at some point soon a repeat will come up. It's just a law of physics. It's called the law of thirds. So what we do is then apply the strategy that I'm creating and studying right now and testing, shall I say? It's created, but testing. We would apply that system and the law of thirds with your money management to have the whole system work for you and in your favor. It kind of allows you to predict to some extent, use the word predict on the house.

Is that what you're saying? Yeah, so it gives you It gives you some foresight To what's coming Which is exactly what the casino does not want you to have They don't want you to have an idea of what's coming, right? That's why when you card count and you know That there are more face cards in the deck

That are still to come A good blackjack player that can count the cards Will be able to go, hey, okay, I'm going to increase my bets now Because I am about to get more blackjacks with all my face cards, right? or get 20s and beat the dealer. So if you are able to forecast that, the casino frowns upon it. And they actually would say, hey, listen, you're going to have to take your game somewhere else. We appreciate you coming in and all that, but we're giving you too much money because you're counting the cards.

You know, it's time to go now. It's time to go. You know, here's a free drink. Get out of here. So don't let the door hit you on the way out. But so in roulette, though, nobody really believes that you can truly forecast what is to come. And that is true. however, based on this law of thirds, it gives you some sort of upper hand on the casino.

The casino might laugh and you say like, yeah, yeah, they're all independent events. You can't forecast it, but you can't. Could you tell me exactly or could I tell you exactly what number is going to come up? No, I couldn't do that. But if you have no repeaters for quite a while, you know that one is going to be coming. So you start betting on those numbers for X amount of bets with your money management strategy, to create the success. Yeah, well, certainly it's still a work in progress.

And I want to obviously start off by saying, like, you know, with gambling, you want to be careful with that. Be smart with your money. And I don't take exactly what I say, go out and do it without proper supervision, studying the game, all this sort of stuff, you know, right? That's my disclaimer, okay? So, you know, something that people get addicted to and do the wrong things with it, right? Right. I mean, you and I were talking about this before, that a gun or a brick or whatever is just an inanimate object, right? So it's only good or bad for how the person that holds that tool. It's what they do with it that makes it a good or bad object.

So gambling's the same thing. If you take the time to study the games like I've been trying to do and learn the systems, money management, things like that, it will be, you'll be much better off in the end. if you take your time instead of just jumping right in and going crazy and get going through the highs and lows that definitely easily come with gambling. So, but yeah, Jack and Coke. I know that. One of the best things you need to remember, biggest things to remember is do not drink and gamble.

That's rule number. Well, I guess one or two is something. It's very high. But for sure, yeah, it's something that I've really dove into. And it didn't start with casino games, which is eventually what we'll get to. It started for me as I was interested in the stock market.

And I would suggest if anyone's interested in this sort of thing to download a roulette simulator and, you know, try it for yourselves. Like just kind of, you know, try this bed. Learn how the payouts are and the lay of the land of the table, if you will, right? And get used to it. And then like as you watch other people show you their strategies, it'll all start to make sense. Like it'll kind of start coming together. But download the simulator first. it's of course it's fake don't trust it as being real right type in youtube rootlet strategies and

watch a few and kind of get the lay of the land you'll start to feel more confident the more you practice and the more you test okay by testing i want to be clear that is only on the simulator not with real money you know what i mean damn okay so i i literally keep saying okay i just i'm trying to agree and stay with you on this conversation i need to like fix my term Just so I don't sound like a dick. It's like, okay, dude, get to the point. Okay, David, since you're such an expert in the law of thirds, can you tell me what I'm going to ask you next?

Well played. Well played. I'm going to go with no. I have no idea where you want to take this. So it's on your, it's on you. Go for it. What's one piece of information or action item for our audience to start implementing today over the core thing that we've talked about today?

Oh man, I think it is so important to take your time. Don't rush. If you get passionate about something, study it. For me, this was roulette. So I downloaded a simulator on my phone and I could play the game, learn about the game, learn the payouts and the lay of the land and whatnot, money management, everything. So I would say download a simulator of a game that you like, study it, practice, not real money, of course. we're talking like monopoly money right uh and uh that way that way it's not too too expensive of a

habit uh that definitely can happen so yeah i would do that and then just practice and and see what you come up with you know uh the more you practice and then you study i used youtube as a source for me i just typed in roulette strategies right and a ton of them came up so uh once you have your roulette simulator you can play that while you test their systems and of course at some point Once mine is gold-plated ready to go, you can also test that. How can our viewers get in touch with you? You can reach out to me on Twitter or email. My Twitter handle is DSM-J-R-9.

And it's the same for my email, DSM-J-R-9 at yahoo.com. And just reach out to me and we can strike up a conversation and I'll share everything I know. Yeah, thank you so much for having me on the show. Really appreciate it. David, thank you so much. I appreciate you being on the show. You take care. It's tax season, and at LifeLock, we know you're tired of numbers.

But here's a big one you need to hear. Billions. That's the amount of money and refunds the IRS has flagged for possible identity fraud. Now here's another big number. 100 million. That's how many data points LifeLock monitors every second. If your identity is stolen, we'll fix it guaranteed. One last big number.

Save up to 40% your first year. Visit lifelock.com slash podcast for the threats you can't control. Terms apply.