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]

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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

[innerpeace]

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the problem is you'd have a very hard time finding players who could beat the game who would want to give up enough of their earn to make it worth your/your investors while.


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with regard to players, i think there are many 'hidden gems' out there who could do very well given the opportunity. for example, i know someone who occasionally posts on these boards and who has an excellent understanding of the game. i am certain he could be a consistent winner at msnl up to about 3/6 and with a little work even 5/10 and above. why doesn't he play higher? in part since he cashed out much of his role just prior to the neteller/uigea debacle, in part since he has a very well paying full time job, so doesn't put in the hours/hands to build a bigger bankroll, he also has a family and doesn't want to get in the habit of dipping into savings to fund a bank roll.

i offered to stake him on several occasions, and he almost took me up on it, but then backed out because he felt uncomfortable getting into such a financial arrangement with a friend. i think he would be a perfect candidate for the sort of set-up op is proposing. i would bet that there are others just like him too.

i'm surprised that many people here are openly against an idea that would infuse more money into the poker economy. are you the same people who berate opponents when they draw out on you?

to the op, i can understand the rationale behind the law of large numbers, but as i'm sure you are aware, i would think there are some great opportunities to fund professional or semi-professional players in ultra high stakes cash games that include independently wealthy, but weak, opponents looking for big action. however, many of these games are private, and so you might have some legal issues.

[GoldenBears]

^^^ But would 40% of profits at the higher stakes table be better than 100% of profits at a lower stakes table?

Also, with cash games you can't just cover them whenever they have a losing session and chop it whenever they have a win, you would never come out ahead. You'd have to add up their net wins and losses over like a year or at least a month, and then cover them if they were down and chop if they were up...

Tournaments you can do game by game though...

[berya]

"He said fund started with 25 players, most in NY playing online in a "hedge fund hotel hookup" and some pros in Vegas" - LOL

So we got a new boiler room and a new scamming/cheating high stakes team coming together. Nice. How do I sign up?

Anybody seen George?

[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.