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View Full Version : Argument with a friend over ROI

EricW
07-20-2005, 06:48 AM
I was telling my friend how after 172 sit n gos, my ROI is 20%.

He also plays sit n gos but on a different site. He was given a free 50\$ bonus for signing up. His bank roll is now 95\$ or something. He says his ROI is infinity.

I keep telling him that that's flawed logic because the money is yours, each time you make a buy in, it's an "investment" and the ratio between money invested and profit is the ROI

He keeps saying that on a whole, his ROI is infinity because he didn't make a deposit. Then I said by his logic, I made a 50\$ deposit and now my bank roll is 815\$ so my ROI is 1500%.

Please clarify this so I can tear into my friend.

tshort
07-20-2005, 06:57 AM
[ QUOTE ]
I was telling my friend how after 172 sit n gos, my ROI is 20%.

He also plays sit n gos but on a different site. He was given a free 50\$ bonus for signing up. His bank roll is now 95\$ or something. He says his bank roll is infinity.

I keep telling him that that's flawed logic because the money is yours, each time you make a buy in, it's an "investment" and the ratio between money invested and profit is the ROI

He keeps saying that on a whole, his ROI is infinity because he didn't make a deposit. Then I said by his logic, I made a 50\$ deposit and now my bank roll is 815\$ so my ROI is 1500%.

Please clarify this so I can tear into my friend.

[/ QUOTE ]

Heh, sounds like a dumb argument. His return on the \$50 taht was given to him is 90%. The \$50 became his when the poker site gave it to him. Same as if a stranger gives me \$1 to buy a lottery ticket and I win \$2. My ROI is 100%. I'm keeping the \$1 the stranger gave me. If I gave it back, I would have an undefined ROI. I assume he is planning on keeping the \$50 the poker site gave him?

He is arguing he made a \$0 out of pocket investment. Therefore, his ROI on his out of pocket investment of \$0 is undefined. It's a silly argument. He can argue about ROIs when he has more than a double digit bankroll.

bmxreed36
07-20-2005, 07:06 AM
Technically since he invested nothing, any positive outcome would be an overall infinite return on investment. However ROI is simply a statistic that we use to measure success/failure/profitability in SNG's. Simply saying that it is infinity doesn't help him understand how well he is doing. Also, it is rather standard that we refer to ROI as the average ROI of each SNG combined rather than an overall return on initial investment.

viennagreen
07-20-2005, 07:25 AM
you're both correct.

the first thing to do when in an argument is to define your terms. your friend and you have different working definitions of ROI.

in your definition, the starting point of your investment is at the beginning of an SNG. however, your friend views the starting point of his investment to be the creation of his poker account.

your argument needs to focus on the merits and utility of using a "return on investment per SNG" definition versus an "overall return".

but there's no right or wrong until you agree on a definition.

mackthefork
07-20-2005, 07:27 AM
So let me clarify, you are having an argument with your friend Roi about \$50, now you want to know who didn't put the seat back down after using the toilet? Is it possible you did it and just forgot, sometimes a compromise is necessary to make a relationship work.

BTW he can only have an ROI of infinity if he has only ever played in freerolls. Error divide by zero. /images/graemlins/tongue.gif

Regards Mack

pergesu
07-20-2005, 08:10 AM
Why don't you just let him win? And just keep makin fun of him for it, be real sarcastic. "School me in the ways of the master poker players, oh wise infinite-ROI one"

Life's too short to give a [censored] about that sorta thing

AleoMagus
07-20-2005, 08:23 AM
You are both correct

When we speak about ROI on this forum, we are talking about average return on investment for each SNG we play. Another way to speak about ROI could be as a return on an investment over time. Since your friend made no investment, then in a sense his ROI is infinite.

In that sense, most winners get a much greater than 20% return on investment, but this is kind of meaningless to speak about, and can be debated as to the monetary value of our time, energy, etc...

So you are right in the sense that we all talk about here, and your friend is right in a smarty-pants kind of way that doesn't really matter much anyways.

Regards

faquewdikhed
07-20-2005, 08:32 AM
If I were you, I would just laugh at him when his ROI goes from infinity to zero.

kasey2004
07-20-2005, 10:04 AM
[ QUOTE ]
If I were you, I would just laugh at him when his ROI goes from infinity to zero.

[/ QUOTE ]

good post /images/graemlins/grin.gif