premium bonds

May do, may not. A win on PBs is pure chance, like playing the lottery, however as with the lottery, the more you buy then more chance you have of winning. I think they say if you invest 3000 then you have approximately 1 chance a year of winning at least 50. I have been lucky. I have had 1000 in for 4 months and I won after the 2nd month, only 50 though, although it's better than any savings account would give me over 2 months. Last month (April) someone won 25,000 with only a 103 investment, they had had them since 1996 however.

HTH, Joe

The message from "Roland Watson" contains these words:

Each 1 bond has a 30,000 to 1 chance of winning a prize each month.

See

Bitstring , from the wonderful person Trev said

Just to add that the =average= rate earned (and given as prizes) tends to be slightly lower than the rate on other NS products, although it is, of course, tax free. However to get to this average rate, you have to include the very small chance of winning the very big prize .. so overall most punters do worse than the published 'average rate' on premium bonds, but a very few do a heck of a lot better.

As Clint Eastwood said, "Do you feel lucky".

It tells you in the booklet what the percentage return is, something like 2.5% IIRC (tax free).

They've skewed it in favour of the smaller prizes, something like 90% of the prize fund is 50 and 100 prizes. So over time you should get close to that percentage unless you are unlucky.

The chances of winning a big prize are miniscule, it's something like one chance in 20 billion for the 1 million prize, per 1 unit. If you're after a big prize you're much more likely to win one by putting your capital into a monthly interest account and spending the interest on lottery tickets.

"Andy Pandy" wrote in message news:EOyec.32144$Y% snipped-for-privacy@wards.force.net...

So how would that work out? If one puts in 2000 into PBs, you have (from your odds above) a 1 in 1,000,000 chance of winning the monthly million pound draw.

If I take the 2,000 instead and put it into a 4% cash ISA, with say 80 interest p.a. that gives 80 lottery tickets over the year. What are the odds of winning the lottery jackpot? I think it is 14,000,000 to one against, so the equivalent of a monthly participation with 80/12 lottery tickets gives odds of 2.1 million to one against each month.

If you wish to calculate the odds per million quid won, the average lottery win I believe is 2,000,000 which brings the odds per million down to 1.1 million to one against every month.

This is still higher than the premium bond odds. Have I miscalculated anywhere?

Thanks,

Roland.

No, 1 in 10,000,000.

Agreed. Compared with 10 million to one against on PB's.

Which makes the lottery about 9 times better...

Well, the same as a not-very-good savings account. Most of the prizes are £50 so it does indeed average out reasonably quickly. Advantages are that it's tax-free and you have some chance of a big win, albeit pretty small.

I think the average lottery win is only that low because most people are in syndicates. Intrinsically I don't believe that the lottery can give better results (i.e. a higher expected gain, rollovers aside) since a substantial fraction of the pool goes in tax and to charities, but it depends on exactly what it is you calculate the odds of.

"Andy Pandy" wrote in message news:o2Aec.32156$Y% snipped-for-privacy@wards.force.net...

Oops, correct. Does this mean that there is 20 billion in premium bonds being held by the public and others?

Roland.

Perhaps we should all ask for our money back, as is our right. "Prudence" is in need of a sharp reminder that the country's wealth is not his to demand at any time, but created and owned by and large by people through honest toil and yielded to him only under sufferance and in the expectation that it will be used wisely and productively.

The lottery probably won't give a better average return, there's more chance of smaller wins on PB's, but more chance of bigger wins on the lottery.

This doesn't alter the average 'win' as far as the stats produced by Nat Lottery is concerned because (AFAIAA) they cant know, for sure, how many winners are fronting syndicates or not.

"Stephen Burke" wrote

Not so - as long as the figures haven't changed since inception of the lottery, then :-

For every 14 million-odd tickets sold, 14m is paid. Out of this, the amount going towards prizes is around 7m. Out of this, the relevant proportion going towards the jackpot prize is generally 2m.

There are nearly 14 million different possibilities for choosing 6 numbers from 49. So if the tickets follow a uniform distribution over all possibilities, there will be exactly 1 jackpot winner per 14 million tickets sold. Thus if 42 million tickets are sold, you should expect around 3 jackpot winners sharing a total jackpot prize of 6m i.e. the average lottery (jackpot) win is 2m.

If a syndicate happens to be one of the jackpot winners, they'll be sharing the average 2m payout between themselves.