Does It Pay to Buy the Pot in the Canadian 6/49 Lotto? Implications for Lottery Design

Despite its unusual payout structure, the Canadian 6/49 Lottoc is one of the few government‐sponsored lotteries that has the potential for a favorable strategy we call “buying the pot.” By “buying the pot.” We mean that a syndicate buys each ticket in the lottery, ensuring that it holds a jackpot winner. We assume that the other bettors independently buy small numbers of tickets. This paper presents (1) a formula for the syndicate's expected return, (2) conditions under which buying the pot produces a significant postitive expected return, and (3) the implications of these findings for lottery design.