Worst deal of the year (PStars $500+30, April 25)

[Greg (FossilMan)]

I hope when I make the final table you're there. With that attitude, I'll know I can get a good deal out of you. I mean, why should YOU make a bad deal to avoid hitting some bad luck? Why shouldn't I be the one to give up some EV? Just think about it that way, and you'll see why your attitude is mistaken.

If you give up EV, it was a bad deal. It's really that simple.

Later, Greg Raymer (FossilMan)

[Johnsears]

I'm not saying that the deal was 100% fair, im saying it was better to take the slightly unfair deal than to take no deal at all.

[Bozeman]

nothing slight about this. if you believe this was a good move, I have a bridge to sell you,

craig

[Tosh]

[ QUOTE ]
I'm not saying that the deal was 100% fair, im saying it was better to take the slightly unfair deal than to take no deal at all.



[/ QUOTE ]

That is so incorrect I don't know how to respond.

[fnurt]

no deal at all = guaranteed $18,000 in this case.

[togilvie]

So buying insurance is a bad deal? It's a clear case of trading EV for variance, and only your personal utility function determines whether or not it's a good trade off.

If you're a 19 year old without a family or mortgage, life insurance may be a terrible deal. If you're a 45 year old sole breadwinner with kids, it's a near necessity. In both cases it's -EV, but there are often compelling reasons to avoid the variance.

For someone with fixed or limited income, the ability to guarantee $30K with a more limited upside may be well worth the tradeoffs made here. Financial utility is not linear; a fact that has been proved by economists repeatedly. And without knowing more about Earlbry and his personal utility, you can't make an assessment of whether the deal is good or bad.

That said, kudos to Exclusive for negotiating an excellent deal for himself. I sure wouldn't buy a used car from him [img]/images/graemlins/smile.gif[/img]

[Johnsears]

Are you rich? Do you have a family to support or bills to pay?

[cferejohn]

Togilvie makes a good point. To make an extreme case, if you have a bookie coming over tomorrow morning who is going to break your legs if you don't come up with 25K, locking up the 30K, even at considerable expense to EV is clearly the right move.

That said, ideally in poker you should have a bankroll that is large enough relative to the stakes you play that you should not have to sacrifice EV for the sake of reduced variance. If you were playing a very high-stakes cash game and you were given an opportunity to draw to the nut flush with the correct odds (let's say an all-in 10K bet into a 40K pot), you should call. If you feel like you can't call because 10K is a significant chunk (or perhaps all) of your bankroll, you are playing to big for your bankroll.

Tournaments offer a strange situation. While your bankroll may be sufficient to allow you to play $500 buy-in tournaments, at this point we are talking about amounts of money that may have an extremely significant effect on the size of your bankroll. You may feel that the marginal value *to you* of the dollars from 18K to 30K outweighs the marginal value of the dollars from 30K to 80K to such an extent that you are willing to give up a significant amount of EV to get the 30K.

It's hard to judge whether that is right or wrong without knowing someone's situation. Clearly Chris Moneymaker felt he was in such a situation when he offered to chop with Farha as something like a 2:1 chip leader. And evidently these players felt that they were in such a situation with Exclusive.

It is obvious that the deal was a poor one in terms of EV, and in my opinion they probably should have tried to get Exclusive to accept a more equitable deal, but without knowing their financial/bankroll situations, I agree with togilvie that it's possible that the deal actually could have made sense for them.

To make a somewhat ludicrous comparison, would you rather recieve 1 million dollars or an 8:1 shot at 10 million dollars? The EV move is clear, but I think the quality of life change from 0-1 million is significantly greater than the change from 1 million-10 million.

That's extreme, and we're not talking about percentages of that magnitude, but I think it illustrates the point.

That said, no way I take this deal. I'm in this poker thing for the long haul, and I'd take the risk for the sake of the EV. On the other hand, I'm single and I have a well paying day job (at which I do productive things like write overlong messages on 2+2)... [img]/images/graemlins/grin.gif[/img]

[cferejohn]

[ QUOTE ]
Are you rich? Do you have a family to support or bills to pay?

[/ QUOTE ]

But John, the logical extreme of this question is to stop playing poker altogether. Assuming you are a winning player, you are sacrificing EV, but you are reducing your variance to 0...

[Johnsears]

I just always thought the point of good poker was to maximize the effect of skill and minimize the effect of luck.