Poker and Finance Part II is deeply unsatisfying

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Nope, your choices are highly limited, with every play having a specific EV and StdDev, so risk-adjusted optimization will never give something like a Sharpe ratio.


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Why not? You DO have choices. Some choices will produce different EV than others, at different standard deviations.

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Nope, you can choose the stakes you are playing for, but again you have a very specific functional dependence of EV and StdDev vs stakes, because the opponent skill level changes, so again, when you maximize risk-adjusted return, Sharpe Ratio will not fall out anywhere by miracle. So basically, I feel that "Sharpe ratio" is introduced in the article just because it sounds cool and has to do with risk management.

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EV is what ties it together. EV is the product of all these factors you mention. It's almost like you have more of a problem with defining EV over a range of hands than with using the Sharpe Ratio.

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You are playing an additional hand, simply because it produces more return, not to reduce variance -- in fact playing an additional hand will have to increase variance.

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No where in the article does it say expanding the range of hands you play will reduce variance. It simply says you're adding value.