View Single Post
  #2  
Old 08-18-2005, 04:42 AM
BruceZ BruceZ is offline
Senior Member
 
Join Date: Sep 2002
Posts: 1,636
Default *DO NOT* Calculate your bankroll requirements with this

[ QUOTE ]
Every week there is a new post about winrates and bankroll requirements. Maybe this can help some of those posters.

Me and Snow (another swedish 2+2er) have created a page where u can calculate how big bankroll you need (given your BB/100 and Standard deviation). And calculate how much your true, long term, winrate can differ from the one you got right now (given your number of hands, your winrate, your standarddeviation and how sure u want to be (1-100%)

The math behind it is taken from Malmuths Gambling Theory and Other Topics . A book you should read if u are interested in these sort of things.

http://www.svenskpoker.com/math.php

[/ QUOTE ]

Malmuth's formulas cannot be used to compute bankroll. They will underestimate bankroll requirements by more than a factor of 2. This thread has the correct bankroll formulas along with a discussion of the problem with the Malmuth formulas. Here is a derivation of the correct formulas. If you want a tool that uses the correct formulas, someone just posted one here earlier today.

I see that your webpage does not give a risk of ruin, but I can tell you that if you implemented Malmuth's "3 sigma" formulas, they will give a risk of ruin of 1.1%, (not 0.13%). So if anyone wants a 1.1% risk of ruin, then OK they can use this calculator, but realize that this is what the numbers mean.

Your win rate and confidence calculation should be OK if you implemented Malmuth's formulas correctly.
Reply With Quote