calculating standard error by 100 hands instead of hours?

[balkii]

I understand that winrate and SD are more accurate based on 100 hands rather than by hours. I was wondering if I can simply substitute 100s of hands for hours in the formula for standard error.

Standard deviation per 100 hands / Square root of # of hands? = standard error of winrate per 100 hands?

Does this make any sense at all? will this work. I have tried it but the number seems too low. When i try it it says my standard error is .09. I don't see how its possible my winrate could be that accurate with this few of hands.


Also anyone taking the time to respond to this, could you please also explain to me the formulas for ROR and bankroll requirements. I have searched for them but i do not understand certain variables in the equations. (exp) and (ln) come to mind. if you could post those formulas and explain each variable that would be most helpful. also explain how this would work based on 100s of hand rather than hours.

Please thank you very much.

[balkii]

Ok i think i just figured out what was wrong. The bottom half of the equation should be SQRT(# of hands /100). This gives me a much more reasonable standard error of .9

But please help me with the bankroll calculations.
ror = exp(-2uB/sigma^2)
B = -[ sigma^2/(2u)]*ln(ror)

ror = risk of ruin (going broke)
B = bankroll
u = hourly rate
sigma = hourly standard deviation

let me see if i got this:

Risk of Ruin = exp(-2 * hourly rate * Bankroll / Standard deviation squared)

What is EXP?

Bankroll = -[Standard deviation squared / (2 * hourly rate)] * ln * Risk of ruin

What is LN?

Also the first formula tells me my risk of ruin given my bankroll, correct? and in the second one I plug in my desired risk of ruin to find out what the neccessary bankroll is, correct?

also does this change if using 100/hands rather than hours?

Thanks for any help

[BruceZ]

Ok i think i just figured out what was wrong. The bottom half of the equation should be SQRT(# of hands /100).

Correct.


What is EXP?

The exponential function e^x where e is the constant 2.718... the base of natural logarithms.


What is LN?[/i]

The natural logarithm. The inverse of EXP. If y = EXP(x) then x = LN(y).


Also the first formula tells me my risk of ruin given my bankroll, correct? and in the second one I plug in my desired risk of ruin to find out what the neccessary bankroll is, correct?

Correct.


also does this change if using 100/hands rather than hours?

It's the same as long as you use 100 hands for both your win rate and your SD.

[BruceZ]

Also, just because you use 100 hands to compute your SD doesn't mean you can't express your hourly rate and SE in units of dollars per hour, and your SD as dollars per sqrt(hr). I typically use session results to compute my SD, where sessions are a variable number of hours long. The SD formula in the essay section allows for variable length sessions. This gives a better approximation to the normal distribution than if I used 100 hands, but the SD I compute is still for 1 hour. I can then express my hourly rate and SE in units of dollars per hour, and I can use hours in the risk of ruin equations.

[balkii]

[ QUOTE ]


The exponential function e^x where e is the constant 2.718... the base of natural logarithms.


What is LN?[/i]

The natural logarithm. The inverse of EXP. If y = EXP(x) then x = LN(y).




[/ QUOTE ]

Thank you for replying , Bruce. I hate to bother you again but i do not understand how to use these. The calculator on my computer has an "exp" button and an "ln" button.

Let me step through it.

ROR = EXP(-2 * 2.42 * 300 / 187.14)
ROR = EXP(-1452 / 187.14)
ROR = EXP(-7.75)
When I get this figure and then click the EXP button on the calculator it doesnt do anything. It beeps.

Should i calculate ROR = 2.718^(-7.75) ?
This gives me 4.3108880418170235713117118788492e-4 whatever the hell that means.

Next equation:
Bankroll = -[187.14 / 2 * 2.42] * ln * .01

Is that how to do a 1 percent ROR? Whats a good ROR, anyway?

Bankroll = -[38.66] * ln * .01
Bankroll = -0.95036471220790652925837976485014
Hmmm...so for a 1 percent risk of ruin i need a bankroll of negative .95 BB....
Makes sense..LOL

Sorry for being a dolt Bruce, i dropped out of math after Pre-cal. And didnt pay attention even then. Thanks for helping me out.

[BruceZ]

ROR = EXP(-7.75)
When I get this figure and then click the EXP button on the calculator it doesnt do anything. It beeps.

Should i calculate ROR = 2.718^(-7.75) ?
This gives me 4.3108880418170235713117118788492e-4 whatever the hell that means.

That is scientific notation for 4.3 x 10^-4 = 0.00043. The number after the e is the power of 10. That means your risk of ruin is 0.00043 or 0.043%. The EXP key should have given you the same thing. That key is usually on the same key with other things (like LN), so you may have to hit another key to select it. Same with LN.


Bankroll = -[187.14 / 2 * 2.42] * ln * .01

Is that how to do a 1 percent ROR? Whats a good ROR, anyway?

Yes. A good ror is whatever you are comfortable with. Many people use 1%. Remember, this assumes you will play forever at these stakes or until you go broke, so if you go down in stakes when you lose a certain amount then you don't need nearly as much.


Bankroll = -[38.66] * ln * .01
Bankroll = -0.95036471220790652925837976485014

-38.66*ln(.01) = 178 bets. Enter .01, hit LN (gives -4.6), then multiply by -38.66. Don't put a multiply between the ln and the .01.