Poker Hedge Fund

[The Dingo]

I was approached a while back to raise funds for the dudes taking on Mr Beal in his Bellagio matches. My background is inv bank trading and running hedge fund/s.

Post UIGEA, basically mid July 2007, depending on the govt actions (or lack thereof) my partners and I were considering the following, note I have done a soft raise of US$10M approx and am sure that will be there if there is no event risk....

Anyway, here is what I want to do

1. Fund online and cash pros on a % win basis to play for a fund much in the way my traders trade for hedge funds and CTAs

2. This part may or may not be legal or even moral but set up a group of bots to play lower limit and lower no limit online poker on various sites (I may set this up in BVI for safety). I would welcome moralistic thoughts on this. Note my own hedge fund trades as a bot using tradestation software and via online futures brokers etc (automated)..

3. A small portion of the fund will be for live tournament pros and online tourny pros.....I actually prefer just taking a chunk and funding some real top low variance pros (any thoughts on this)..say $400k per year for 1 or 2 top liners to play.

What size capital could be put to risk in the various poker segments (would $100M be too much), ie how many say 1/2, 2/4, 3/6, 5/10, 10/20 limit, no limit, PLO etc games could we fill out.

Any and all f/b welcomed including thoughts if this is just batshit crazy (I have reviewed many online pros equity curves and they are amazing, truly remarkable so I think as a fund concept aiming for a low variance ror it looks good).

I am based in NY but have partners in "safe jurisdictions" so we are expert in structuring offshore entities and tax haven stuff etc...

[Mingdu]

[ QUOTE ]
set up a group of bots to play lower limit and lower no limit online poker on various sites

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yeah, no

[SlowHabit]

I stopped reading after "set up a group of bots to play lower limit and lower no limit online poker on various sites."

[EmpireMaker2]

This was tryed before on never win and he scammed everyone

[duke186]

I think it's pretty smart, especially for you. If you look on opr, the top tournament players have about a 100% roi over a large sample size. Backing 50 of the best would have extremely low variance, especially at the volume that most of these guys play.

I think it would also make sense to back cash games players and roll them for grinding a level below whatever they play. You can look up the costs for each level in terms of the roll required, but i think the variance will be very low for people that have already killed that level and have moved up.

Also you didn't mention sngs, but for the best, the variance is incredible low. sharkscope guys like tatta who essentially have a straight upward sloping line with no blips over thousands of games.

And I think that i once read that Scott Fischman's tourneys are staked by a hedge fund in NY, i might be wrong about that though. I would check around and see how that arrangement works. I don't think you would have any problem getting tourney and sng players to give a cut of their profits for zero risk.

[NoahSD]

I don't know your background at all, but figuring out who's a winning player from the outside is pretty hard.

[rand]

you have a good idea but from the players point of view you are lacking any credible incentives...there is obviously an equilibrium where the players winnings meet his supposed "salary" here he is indifferent to playing for himself or working for you-the problem is (I find it hard to believe that you ignored) that this is also where you make zero profit from his employment

so why would anyone work for you when they could play for themselves and at the point that they would work for you why would you pay them>?

your only shot is to find good/winning players who are dry... giving these players the start up capital to play higher than they are currently rolled (but at a level where they are winnings) would be a good deal for both of you
-i however think that these players are VERY few and far between

[KRANTZ]

[ QUOTE ]
Because my man if you have a bankroll of $500k and are making $250k per annum and someone gives you a deal where you can make more for ZERO risk it is a great deal..

this is how hedge funds work and why they get the best talent from the investment banks so when you say gee this guy makes $300k per year doing what he does and his mate plays for a fund and makes $1.5 M per year and runs his own show and has NO RISK.......too frickin easy

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if you have a bankroll of 500k you are making way way way more than 250k/year