They have a much better term that really captures this stuff it is, "a martingale."
Edit: Just to clarify, a martingale is a bet that's equally likely to go either way and has zero expected value.
Edit: Just to clarify, a martingale is a bet that's equally likely to go either way and has zero expected value.
Probably the etymology that makes most sense is that it refers to people from Martigues who were considered to be naive. So people knew that the simple strategy of “betting all that was lost” was horrible even in Middle Ages.
But parent was implying that a martingale means that after a crash, stock prices rebound.
This is a nice strategy if you like casino gambling and focusing on the atmosphere and experience and not going full bore on advantage play. Say you have a $20,000 marker limit. Your starting bet on a game with a reasonable house edge like a player friendly blackjack table should be $200 a hand. Then as you win or lose your bet will grow or shrink respectively. While it's possible with extraordinarily bad luck to blow through your entire bankroll, odds are very good that you'll come home with at least a decent chunk of your stake if you can play basic strategy. Even though with basic strategy on a good table the house has around a half a point of edge, last I knew comps were computed using a 2 point model. So if you value the RFB experience even a basic strategy player can come out "ahead."
Of course you should never gamble money you can't afford to lose. It's always possible you will have catastrophically bad luck.
Pretty much the same applies to any gambling, including options trading. The main difference there is you probably want a considerably larger stake that you're willing to lose than twenty grand and you need considerably more discipline than you do at a table game. That and of course you want to avoid bets where the potential downside is more than your stake, which isn't a problem that you face at a casino.