Premuim bonds versus National lottery which has the higher probability to win??

Doomcow

both are a rip off.. put it in a savings account and look towards the future.

Energize

With lotto hotpicks the chance of winning £130,000 is 1/317,814 and £7,000 is 1/14,126 I'd prefer those odds to premium bonds.

leveller2911

well someones got to win on the premiums bonds, so why NOT me?:rolleyes:

statistics, statistics and more [EMAIL="blo@dy"]blo@dy[/EMAIL] statistics.......:rotfl:

Look at Santanders ISA advertised on TV, 1.5% interest with a 2% (variable) bonus at the end of the year..................key is is the "variable" bit, just sneeked in quietly, so from that we can assume it could be 0.5%???

All savings and investments are a gamble at the moment ,I have a bond maturing tomorrow and will get some PB,s for a while, got to be worth a punt.:D

chopperharris

Energize wrote: »

With lotto hotpicks the chance of winning £130,000 is 1/317,814 and £7,000 is 1/14,126 I'd prefer those odds to premium bonds.

You all got me thinking about the odds and returns of my pbs now.

My math skills are as rough as the proverbial badgers behind , no doubt theres a ten year old that knows better then I do....or a bent bookie.

I failed my maths o level at the first question , and that was only NAME.

So math guys please help me understand the winning odds of my 30k.

PB data - Using the new rates and max holding.

All 30,000(b) numbers are drawn against each of the single random generations of the 1,075,065(d) prizes every month , even a winning one is re-entered.

SO is it (d) divided by (b) if so it gives me an answer of 35 ... so is that giving me a one in 35 chance of a win or the answer that I am really 35x more likely for a win than any single bond.

Perhaps its really as simple as total amount of all the pbs in existence divided by prizes and that gives me the true odds , ie for anyones single bond , then its divided by my 30000 to give me the answer of my odds?

you see my problem....yes I am both those peices of wood.

chopperharris

goodgirl wrote: »

Premuim bonds versus National lottery which has the higher probability to win??

Trying to convince my partner that 2 lottery tickets per week plus scratcards (arround £100 a month) is better spent on premium bonds you have the change of winning £1 million and keep your cash...not getting very far though does anyone know which has the higher probability of a win???

I have another way of thinking about this for you and convincing oh.

You put it into pbs , theres a chance of winning , just like the lottery..but you keep the stake thats a gimmie.

If you dont use the stake your chances are increasing , unlike the money on lottery and scratchers which were a one time deal , thats a gimmie.

Do you maybe pay credit for a holiday every year?

If you do then treat it as a "kind of gambling yet saving piggy bank" , rather than paying interest on a holiday your simply saving for it....once you get enough in well thats your hols paid for and cheaper.You can roll any winnings into it like an accumulator.

If you are spending 1200 quid a year on lotto and getting nothing back from it then this way your definately getting a return , even if its only the stake back.

Work out how much you have won over the years on lotto and any other gambling v loses....you will see even with no winnings as a return your still up.

Wife and I have 60k in pbs.We get on average at least one win between us a month best was 350 quid combined so far and thats since october....hers is from jan.

We must have spent thousands since lottery began , or on bingo (well down), fruits (well down), nags (barstart crooks).

No-one wins at gambling if they have to replace a lost stake for every chance at a win....its diminishing returns unless you double your stake each time or quit...but I suspect you die before your double down comes.

I figured out once that our return on bingo was udner 1/3rd of what we spent , and that was quite high as a return compared to others.Our return on lottery was well under 1 percent.Nearly no return on fruits and nags.

ChuckCash

I agree with Aegis to a large extent on this. But like a flutter so here's my reasoning:

The effective rate on premium bonds is now down from 1.8% to 1%. This means that someone with £30,000 invested would win £300 on average over a 1 year period.

There are plenty of savings accounts which still pay >2% interest, so if i put the £30,000 into a savings account i can earn £600 in interest over 1 year. I can add £300 to the principle and gamble the remaining £300 on the lottery, thus giving me guaranteed interest (1%) + possible jackpot prize.

I tend to be more unlucky than the national average, so this formula is good for those born with such an affliction

Aegis

chopperharris wrote: »

You all got me thinking about the odds and returns of my pbs now.

My math skills are as rough as the proverbial badgers behind , no doubt theres a ten year old that knows better then I do....or a bent bookie.

I failed my maths o level at the first question , and that was only NAME.

So math guys please help me understand the winning odds of my 30k.

PB data - Using the new rates and max holding.

All 30,000(b) numbers are drawn against each of the single random generations of the 1,075,065(d) prizes every month , even a winning one is re-entered.

SO is it (d) divided by (b) if so it gives me an answer of 35 ... so is that giving me a one in 35 chance of a win or the answer that I am really 35x more likely for a win than any single bond.

Perhaps its really as simple as total amount of all the pbs in existence divided by prizes and that gives me the true odds , ie for anyones single bond , then its divided by my 30000 to give me the answer of my odds?

you see my problem....yes I am both those peices of wood.

Combinations of probability unfortunately aren't simple to work out. In this case you were looking at holding 30000 numbers compared with 1075065 prizes. Imagine that you could hold 1075065 bond and consider if there is a possibility of getting zero return. There is a slim chance that this will be the case, likewise if you held 2000000 bonds there is an extremely small chance that none of your numbers will come up.

What you need here is a fairly complicated binomial expansion which looks at the overall probability of each prize. I believe this is the basis for Martin's Premium Bond probability calculator, which can show you what you would expect to win over the whole year.

In short, better to stick to the calculator than to try and work it out for yourself. That goes for me too!

RichardJW1

I have the full 30k and last year it returned +1.5%. This year after 3 months I already have +0.8%

iltisman

The only attraction of PBs and the lottery is a life changing win something you will never get with saving.I now only play the lottery when its a rollover.

Paul_Herring

G_M wrote: »

£100 per month?!

No, £100 total.