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#1
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Variance vs Bankroll paradox
I've skimmed through some of the limit vs no limit threads that are popping up lately.
Everyone seems to agree that limit has higher variance than no limit. I don't know why this would be true, but since I've seen it quoted so many times, I'll assume it is correct. Everyone also agrees that conservative bankroll management means having 300BB's for limit, and 20 buyins for no limit. This means that, if you want to play $1-$2 limit, you need 600$, and for $1-$2 NL, you need 4000$. I don't understand. Wouldn't higher variance mean that you need a bigger bankroll to deal with the swings? For example, a +5 buyin downswing in NL isn't uncommon. At $1-$2 NL, this would be $1000. Someone help me out? |
#2
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Re: Variance vs Bankroll paradox
Variance is relative to EV. EV is higher at $1-2 NL than $1-2 Limit. You need to compare $1-2 Limit to some much smaller NL game where your winrate will be similar.
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#3
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Re: Variance vs Bankroll paradox
Actually, NL has higher variance. When people say limit has higher variance I believe what they actually mean is limit has a higher variance to winrate ratio
It is only with this ratio you can get a meaningfull comparison between limit and NL |
#4
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Re: Variance vs Bankroll paradox
yeah 1/2 Limit, means 1$ preflop/flop 2$ turn/river
1/2 NL means 1$ small blind 2$ BB.. totally different games although the names suggest otherwise |
#5
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Re: Variance vs Bankroll paradox
[ QUOTE ]
Everyone seems to agree that limit has higher variance than no limit. I don't know why this would be true, but since I've seen it quoted so many times, I'll assume it is correct. A. Not everyone agrees, because not everyone is talking about the same thing. When you play $1/$2 limit, and have a SD (perhaps as shown on poker tracker) of 16x your big bet, then you can expect your average win or loss to be withing one SD or $32 dollars. If you play $1/$2 NL and have the same SD of 16x the big blind, then you would be within one SD (or $32) for your sample. Now, how many players have a SD of exactly the same at limit as NL, and can use poker tracker numbers for both - who knows. I know that my SD is lower at NL, and I book more winners as a percentage of my total sessions - this (in the way I look at it) gives me lower variance. Q. Everyone also agrees that conservative bankroll management means having 300BB's for limit, and 20 buyins for no limit. A. No, the 300BB bankroll and 20 buyin bankroll is a minimum to keep you within a small chance of losing your entire bankroll. A conservative bankroll is 500BB or 30 buyins at NL, and some players are at 1000BB and 50 buyins. This means that, if you want to play $1-$2 limit, you need 600$, and for $1-$2 NL, you need 4000$. Your two games can not be compared well - the average number I have seen quoted by believable posters (who play the game well) here over the past two years for limit $1/$2 win per hour/table is about 2.5BB ($5) however, the number for NL players in the same ability category is 10 big blinds, or $20 per hour. Big difference. Q. I don't understand. Wouldn't higher variance mean that you need a bigger bankroll to deal with the swings? Q. For example, a +5 buyin downswing in NL isn't uncommon. At $1-$2 NL, this would be $1000. A. You need to compare your average win, or SD. Forget about "giving" some numbers here that you think are good. Someone help me out? [/ QUOTE ] Dogmeat [img]/images/graemlins/spade.gif[/img] |
#6
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Re: Variance vs Bankroll paradox
[ QUOTE ]
Your two games can not be compared well - the average number I have seen quoted by believable posters (who play the game well) here over the past two years for limit $1/$2 win per hour/table is about 2.5BB ($5) however, the number for NL players in the same ability category is 10 big blinds, or $20 per hour. Big difference. [/ QUOTE ] Actually, the usual figure given for NL is 10 PTBB/100 = 20 big blinds/100 or $40/100 hands. |
#7
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Re: Variance vs Bankroll paradox
[ QUOTE ]
[ QUOTE ] Your two games can not be compared well - the average number I have seen quoted by believable posters (who play the game well) here over the past two years for limit $1/$2 win per hour/table is about 2.5BB ($5) however, the number for NL players in the same ability category is 10 big blinds, or $20 per hour. Big difference. [/ QUOTE ] Actually, the usual figure given for NL is 10 PTBB/100 = 20 big blinds/100 or $40/100 hands. [/ QUOTE ] You are correct. To the original poster, to get a closer look at "similar" games, you might look at $1/$2 limit where you have a $50 buy-in, and .25/.50 NL with the same buy-in of $50. The overall win per hour is closer ($5 @ limit to $10 at NL) and two players with comparable skill at each game will have a closer variance, but I would put down a very large bet that the NL player experiences less. Dogmeat [img]/images/graemlins/spade.gif[/img] |
#8
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Re: Variance vs Bankroll paradox
[ QUOTE ]
I don't know why this would be true, but since I've seen it quoted so many times, I'll assume it is correct. [/ QUOTE ] Careful what you assume... especially in here. From my 8 years of playing: No-limit... played optimiunally against today's players has huge variations. |
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