Approximate Kelly BR for LHE?.

[Baulucky]

I'm going to take a shot at higher games and I want to risk the minimum, while still giving myself an optimal chance of success.

Using BruceZ's formulas, with an SD=16 BBs, EV=3.5 BBs (incl. rakeback/propping), and 13% ROR. I come up with ~BR=75 BBs

The intention is to move up/down in limits according to BR till I reach 15-30 and then stay there for a long time.

I know I will need to get lucky somewhere along the way.

Is that 13% ROR close enough to the Kelly point for poker as it is for Blackjack?.

[Dov]

It depends.

The kelly system allows you to assume any ROR you want. As I understand it, the 300BB guideline for LHE gives you a better than 90% chance.

If you're looking to move up fast and want to assume a high ROR like 13%, then there's nothing wrong with that. Just realize that ruin is a real phenomenon and most gamblers like to avoid it like the plague.

If you can already beat the 15-30, then there is nothing wrong with your plan, as long as you realize that you may have to forgo some marginal +EV situations in an effort to minimize variance.

You won't have to get too lucky if you are a good player. If you can crush the limits you plan on playing, then you will likely not have a problem. But, if you really can't beat the games...

Dov

BTW, If you are good at NL, you may be able to build your roll faster, and with less variance.

[pzhon]

[ QUOTE ]
Using BruceZ's formulas, with an SD=16 BBs, EV=3.5 BBs (incl. rakeback/propping), and 13% ROR. I come up with ~BR=75 BBs
...
Is that 13% ROR close enough to the Kelly point for poker as it is for Blackjack?.

[/ QUOTE ]
The calculation is essentially the same. Kelly would say BR = SD^2/edge. 16^2/3.5 = 73.1, so playing at the level where you would have a 13% ROR is just what the Kelly Criterion would recommend.

Of course, your actual probability of having to move down is far greater than 13%. Also, I think you will find the assumption that you can get the same 3.5 BB/100 at higher limits that you do at lower limits to be inaccurate. There is a huge difference between having 2 good players and 3 mediocre players divide up the mistakes of 5 bad players and having 3 good players and 4 mediocre players divide up the mistakes of 3 bad players.

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I know I will need to get lucky somewhere along the way.

[/ QUOTE ]
You are lucky every time you win a pot, and you will need to win some pots. However, if you are a winning player as you assume, you will not need to be lucky on average to move up in levels.