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Calcutta buybacks

Posted By: Tom Keith
Date: Monday, 15 June 2015, at 3:14 p.m.

In Response To: Calcutta buybacks (Roland Scheicher)

Suppose I buy a lot of three players (A, B, and C) for $300 dollars. Are you are wondering if Player A can choose to buy back half of just himself rather than a share of the entire lot? (Presumably he would pay one half of one third of the $300 purchase price, or $50.)

That really wouldn't be fair. Suppose Player A is a strong player (10% chance of winning the tournament, and B and C are weak players (2.5% chance each of winning). In effect, $200 dollars of the $300 I spent to buy the lot is going on A's prospects of winning and $50 is going on each of B's and C's prospects of winning. The fair value of a one-half interest in Player A is therefore $200 / 2 = $100.

Allowing Player A to buy half of himself for just $50 would a great deal for him but not such a great deal for me.

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