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#1
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Diff b/t ROI + ROR???
From what I have been told ROI is Return on Investment. What is ROR and how is it calculated?
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#2
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Re: Diff b/t ROI + ROR???
RoR = Risk of ruin. It has very little to do with ROI, it is a function of your profit/tourney, standard deviation on profit/tourney, and bankroll. It's equal to
P = profit/tourney B = bankroll S = standard deviation Then RoR = e^(-2PB/(S^2)). |
#3
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Re: Diff b/t ROI + ROR???
Risk of Ruin
R=EXP(-2HB/S^2) where: R=Risk of Ruin B=Bankroll S=Standard deviation/tourney (or per hour in ring games) H=Win rate. Avg profit/tourney (or hourly rate in ring games) B=-(S^2/2H)LN(R) is to determine bankroll requirements for a given risk of ruin Regards Brad S |
#4
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Re: Diff b/t ROI + ROR???
Then on to asking another beginner question...
What is used to calculate the standard deviation? I know how to work with standard deviation from college stats class, but what poker results and numbers are used? |
#5
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Re: Diff b/t ROI + ROR???
For a typical sng paying three spots, SD is calculated as follows:
SD=SQRT((Probability of 1st)(net profit for 1st)+(Probability of 2nd)(net profit for 2nd)+(probability of 3rd)(net profit for 3rd)+(probability of finishing out of the money)(net loss)+(avg profit/tourney^2)) Regards Brad S |
#6
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Re: Diff b/t ROI + ROR???
oops, looking at that again, I realized I made an error
it should read: SD=SQRT((Probability of 1st)(net profit for 1st^2)+(Probability of 2nd)(net profit for 2nd^2)+(probability of 3rd)(net profit for 3rd^2)+(probability of finishing out of the money)(net loss^2)+(avg profit/tourney^2)) Sorry about that Brad S |
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