Ed Thorp – A Genius Blackjack Player
Ed Thorp is a mathematician, former professor, hedge fund manager, book writer, and blackjack researcher. This genius man is also known as the father of card counting thanks to his best-selling book, Beat the Dealer: A Winning Strategy for the Game of Twenty-One. But there is a lot more to Edward Thorp, so let’s dive in.
In this piece, you will learn details about Thorp’s personal and professional life. First, we will tell you more about his background, followed by a quick overview of his accomplishments as a professor and a hedge fund manager. Then, you will learn more about Edward’s gambling career. At the end of this piece, you will discover answers to the most popular questions about the mathematician.
Edward Thorp – Early Life
Edward O. Thorp was born in Chicago, Illinois, on 14th August 1932. His father was a war veteran that worked hard to ensure that his son got a nice education. With the beginning of WWII, Mr. Thorp Senior was called to serve America, so his mother took a job at Douglas Aircraft to make ends meet.
Hence, Edward Thorp was on his own for long hours during the day, and unlike most of the kids his age, he turned to books which sparked his passion for science. Young Thorp even took a few unusual hobbies like making explosives and playing chess over a HAM radio. The video below tells the story of Edward O. Thorp, make sure to check it out:
Luckily, his father returned home safely, and the Thorp family moved to California when Edward was 10 years old. The young child had a growing thirst for knowledge and was interested in all things scientific. When he was 13, Edward was a licensed HAM radio operator, and he realised that the scalp could conduct electricity.
This gave him an idea. Edward was planning to shave his head, put electrodes and rig a door with a motor and receiver, which he would open and close with his mind. However, he never really got to it because he was working on multiple projects even as a teenager.
A couple of years later, his favourite teacher was telling the class a story about his recent trip to Vegas to play roulette and how you could not beat casinos. Edward said that he could and would try. The orbiting ball of a roulette wheel reminded young Edward of a planetary system or a pendulum gradually dissipating energy. Thorp says that his idea just stuck in his head and then resurfaced during his masters at UCLA in 1955.
Ed Thorp – The Academic
Ed Thorp received his bachelor’s degree in physics in 1953, followed by a masters in 1955, and a doctorate in 1958 at the University of California, Los Angeles (UCLA). For nearly two decades, Thorp worked as an academic at US universities where taught mathematics and finance. Here is a list of the roles he took throughout the years:
- Professor at the Massachusetts Institute of Technology (MIT)
- Professor of Mathematics at the New Mexico State University (NMSU)
- Professor of Mathematics & Finance at the University of California, Irvine (UCI)
Thorp started his academic career as a professor at the Massachusetts Institute of Technology (MIT) from 1959 to 1961. He was then a mathematics lecturer at the New Mexico State University (NMSU) between 1961 and 1965. That year he became one of the founding faculty members at the University of California, Irvine (UCI), where he taught mathematics and finance.
The Hedge Fund Manager
Edward Thorp is also known for his career on the stock market. He entered the field as early as the 1960s and used his knowledge of profanity and statistics to his advantage. Thorp discovered and exploited a number of pricing anomalies which helped him make a fortune. His first hedge fund was Princeton/Newport Partner (1969-1989), and it was based on Market Neutral Derivatives Hedging. Thorp’s second hedge fund was Ridgeline Partners (1994-2002), and it was based on Statistical arbitrage.
Since 2002, the return of statistical arbitrage options has not been unexceptional. This led to the closing of the Ridgeline Partners hedge fund. Currently, the mathematician is the President of Edward O. Thorp & Associates, located in Newport Beach, California. Interestingly, Thorp has reported that his personal investments yielded a 20% rate of return averaged for over 28 years.
Edward O. Thorp’s Gambling Career
Ed Thorp is an academic, financial expert, and blackjack player. As we mentioned earlier, the mathematician had his mind on beating the casino from a young age. And just like many other rich gamblers, he spent some time in Vegas and Lake Tahoe, where he was testing his theories and strategies. Thanks to his gambling and financial expertise, Ed Thorp net worth is more than $800 million.
Ed Thorp – The Blackjack Player
Thorp’s interest in blackjack only grew during his time teaching at MIT. He was looking to crack gambling with mathematics and spent hours on end doing it. The two games that really picked his interest were roulette and blackjack. The professor stumbled upon a blackjack strategy article in a statistical journal and decided to go to Las Vegas with his wife. Edward Thorp left Sin City convinced that there is a perfect system to win.
There were two main tools in Ed’s arsenal. The first was an IBM 704 computer, and the second was the Kelly criterion – a formula developed to determine the ideal size of a series of wagers. Shortly after, Thorp brought in a fellow mathematician, Claude Shannon, to help him find the perfect system. The duo created the first pocket-size computer which is now illegal.
Back then, there were no card shuffle machines, which made it easier for professional gamblers, like Ed Thorp, to keep track of the cards. Thus, Edward was able to develop his perfect winning system. However, as you know today, most casinos use card shuffle machines to prevent card counting.
The Father of Card Counting
Often referred to as the father of card counting, Edward O. Thorp wrote Beat the Dealer: A Winning Strategy for the Game of Twenty-One. The book was released in 1962 and has sold over 1 million print copies to date. The Ed Thorp blackjack book was the first that proved mathematically that card counting could help in overturning the house edge in blackjack.
The Ed Thorp card counting strategy was described in his book which is considered as the ultimate guide to card counting. Beat the Dealer presents the reader with essential charts that are easy to memorise and use by anyone. On top of that, these strategies are still being used when playing blackjack at the best online casinos.
The Book Writer
Beat the Dealer is probably Thorps’ most popular book, but he has written a few more since the 1960s. Even today, you can still find some of his other creations at the bookstores. Edward O. Thorp wrote academic pieces, autobiography, and of course, an extensive guide to gambling and the stock market. For your convenience, we prepared a list of Edward Thorp’s published books:
| 📚 Book Tittle | Year of Publishing |
|---|---|
| 🤵 Beat the Dealer | 1966 |
| ➕ Elementary Probability | 1966 |
| 📈 Beat the Market: A Scientific Stock Market System | 1967 |
| 🧮 The Mathematics of Gambling | 1984 |
| 🃏 A Winning Bet in Nevada Baccarat | 2013 |
| 👨💼 A Man for All Markets: From Las Vegas to Wall Street, How I Beat the Dealer and the Market | 2017 |
That is not all! The mathematician genius has also published a number of academic papers. The topics he wrote about vary from game theory and functional analysis to probability. Having said all that, it is safe to say that the Ed Thorp blackjack strategy is one of the most popular ones to date.
Popular Questions about Ed Thorp
Ed Thorp is many things – a mathematician, hedge fund manager, and last but not least, a blackjack player. We did our best to address the most important points of his life, but we might have missed something out. Hence, we prepared answers to the most popular questions about the man.
