Taking a shot at mid-stakes

[TheWunderkind]

ya man good look, time to get your way out of these low limits!

[emerson]

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Weekly settlements are much too frequent. It should be like quarterly. And then, don't split all the profits. Take out perhaps half the profits and split them. At the end of the year settle up.

20,000 hands is not close to a long run. With arrangements that short the investor should get a bigger cut. It should converge upon 50:50 as the sample becomes meaningful.

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Well this thread has kind of become about staking. [img]/images/graemlins/frown.gif[/img] In any case it doesn't matter how much you settle if you don't reset the running total. For example:

Week 1: I win 400. 200 to staker (staker +200)
Week 2: I lose 800. staker pays 600 (staker -400)
Week 3: I win 1000. 700 to staker. (staker +300)

Instead we settle after 3 weeks. I win 600 staker gets 300. So were settling after 20K weekly settle ups are so the money doesn't get to out of whack with reality. Note that this is similar to what is done in futures markets with margin accounts. As the deal gets closer to completion, the amount each party has coverages to the end result.

Also I don't understand how it should converge on 50/50. This doesn't jive with how I understand the EV of this situation works. Seems as the deal gets longer the stakers % should go down to the point were he makes the same on his investment that he could get elsewhere given similar risk. 150K hand 50/50 win:cover loss stake on a decently winning player is hugely +EV for the staker. If your not willing to take less, you're missing opportunities.

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Well, while I'm a professional gambler I have really made almost as much in the last decade financing others. It is the business I'm in. I would never finance someone who needed a settlement every week, or every three weeks. This is destitute individual. I don't finance such people. They are generally not stable in their real lives much less at the tables. Financing such people is a losing venture.

I realize I'm looking at this from the investor point of view and not the player's. It is because I've done it for a long time. Frequent payouts are bad. You ultimately will go on a downsteak, you will have been overpaid for the period played. When deep in the hole you will realize it will take a considerable amount of winning before you are paid again. You will either lose the desire to play or start playing in a higher variance style in an attempt to recoup quickly. The investor will see you doing poorly and may decide to pull the plug. The investor will never see any of the money you owe him. It is a bad deal.

To address your last point: you don't understand how it will converge upon 50:50.

This has to do with getting in the long run. Over the short term your win rate is dwarfed by variance. You may have a win rate of 1BB per hour but a standard deviation of 12BB/hr. If you are winning early on, you are mostly being paid on variance. This is why the investor should get the lion's share of this. He is covering 100% of the downside variance and should get 100% of the upside variance. The two wash in the long run. You should be paid, at the very most, about .33 BB for each hour that you have played. At the end of the year look at the total amount won. The investor can then pay you more money such that the total recieved is 50% of the amount you have won.

If you plan to continue being financed after this period, the investor should hold a substantial portion of your earnings in escrow for equalization purposes in the event of you having a downturn.

[Frogic]

Because of what this thread is turned into I thought I'd talk a bit about my staking experience. I'm also a professional gambler and made my living playing low limit shorthanded before finding out about bonus whoring. I made a ton hitting up online casinos around the time my friend busted for the 19th time or so. Some background: Although he was a consistent winning player( a few hundred thousand hands of winning 3bb/100 at limits up to 30/60 before frist) his money management skills are horrible. Basically every upswing came with limo rides/new suits etc and this before becoming fairly into cocaine while supporting gf who is the same. Combined with taking on his degenerate gambler father's 20k debt from a loan shark found him needing backing in a serious not wanting to have leg broken way.

The deal we struck about 10ish months ago is as follows: Term 1) at all times I have full control of all poker accounts because of his bad money management(all under my mom's name actually). Term 2) Profits are 50/50 including all rakeback/bonuses Term 3) Cashouts will occur at 1k intervals with an original $2000 profit buffer (no longer exists). Term 3) After I have recouped my 5k investment 50% of all money I make is reinvested in the roll so that he can move up. Term 4) As long as he is playing a lot of hands I will lend him the money he needs to survive+a decent amount for leisure. Term 5) Depending on how high debt has gotten I take from his profits money to pay back his debt(minimum 30% usually around 50% a few times it has been 100% in extreme cases).

This all went great for a while. While managing the amount of money he had he didn't have the upswing money to do large amounts of coke, and within the first 5 months or so the roll reached around 34k and he completely paid off all debts. Once everything was paid back he went back into his old spending habits and started a cycle of collecting/repaying large debts. This cycle continued until he around the 45k point when he hit a downswing where the roll hit a low point of about 18k.

While considering ending the stake and booking a close to 90k profit with rakeback I didn't feel like I could leave him as was. So we restructured the deal as followed. Same deal with debts/money management but how every 2k made allowed for 1k cash out(50/50 him and me) and $500 to repay the stake.

This has worked out great, as the all the money lost is repaid(as of yesterday), and his debts are getting closer to manageable.

[6471849653]

15-30 could be different, more aggressive, simulating high limit games (that's why I view it as the first high limit level). 10-20 could be a solid middle limit game and if one can beat 5-10, 10-20 might not be all that much different, though the competition could be clearly tougher and one gets beaten.

Not sure about two tabling when first trying, and with a 100x BR (shot). Taking one table (and knowing before entering how it plays or rates to play) and picking it well looks like the way to go till one gets some more experience and some more money.

[emerson]

That's a good account, thanks for sharing. It reminds me of a young fellow I financed at blackjack about a dozen years ago. At that time I financed poor people to help them out... a losing venture. Now I look for good business arrangements with responsible adults and have had many good experiences with sports betting, blacjack, and various casino promotions.

Young talented individuals who are irresponsible and have lots of vices are a hopeless cause. They need to grow up. A financial backer will not help them succeed in the game of life.

[Leader]

Monday update:

Didn't play much. One quick session to get my feet wet. <font color="red">-2.5BB</font> Was down 15 then came back. Pretty uninteresting. Games were decent. Hard to get a rhythm though because the good games tended to break pretty quickly.

One hand:

Pre-flop: (6 players) Hero is UTG with K[img]/images/graemlins/diamond.gif[/img] A[img]/images/graemlins/heart.gif[/img]
<font color="#cc0000">Hero raises</font>, 3 folds, <font color="#cc0000">SB 3-bets</font>, BB calls, <font color="#cc0000">Hero caps</font>, SB calls, BB calls.

Flop: T[img]/images/graemlins/spade.gif[/img] T[img]/images/graemlins/heart.gif[/img] T[img]/images/graemlins/club.gif[/img] (12SB, 3 players)
SB checks, BB checks, <font color="#cc0000">Hero bets</font>, <font color="#cc0000">SB raises</font>, BB folds, Hero calls.

Turn: 2[img]/images/graemlins/diamond.gif[/img] (8BB, 2 players)
<font color="#cc0000">SB bets</font>, Hero calls.

River: K[img]/images/graemlins/heart.gif[/img] (10BB, 2 players)
<font color="#cc0000">SB bets</font>, Hero calls.

Results:
Final pot: 12BB
<font color="#ffffff">SB showed Qd Td</font>
<font color="#ffffff">Hero mucks Kd Ah</font>

I felt decent about this one. Villain is pretty LAGy from his stats. I've noticed that most bad players lead out into a cap in spots like this with pairs. Obviously it's not impossible that he c/r'ed with cheese or a PP, but it seems more likely then one might otherwise suspect for him to have a T. Plus win 1; lose 2. He also didn't pause before the river bet. You'd think if he had JJ or something he would at least miss a beat.

[Dave Mac]

i think not raising the river sucks pretty bad.
dave

[HOWMANY]

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not raising the river sucks pretty bad.


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Agree, we got lucky he had a T here because raising the river here is 100% the best long term play even though we need to call a 3bet every time.

[Dave Mac]

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we need to call a 3bet every time.

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i am not convenced that this is tru. i would def consider a fold, esp if i have any idea that he is not super trciky or bat [censored] insane. i think that this is a fold a lot of the time.

[vmacosta]

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we need to call a 3bet every time.

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i am not convenced that this is tru. i would def consider a fold, esp if i have any idea that he is not super trciky or bat [censored] insane. i think that this is a fold a lot of the time.

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funny thing is that you could make nearly a full 1 BB mistake every time he 3-bets and it would still be correct to raise. People never seem to be able to fold PPs here.

oh and btw, leader i have much respect for your posting--gogogogogogo