Bankroll Management

[Nelob]

I am strictly a MTT and SNG player.
How many MTT buy-ins do I need and how many SNG buy-ins to I need to maintain and build a healthy bankroll.
I am comfy at the $5 level.

[pzhon]

[ QUOTE ]
I am strictly a MTT and SNG player.
How many MTT buy-ins do I need and how many SNG buy-ins to I need to maintain and build a healthy bankroll.
I am comfy at the $5 level.

[/ QUOTE ]
This depends on a few factors. While many people will offer their favorite number, and then someone may suggest twice that number to look wiser, the bankroll you need depends on you, and not whatever number is fashionable.

A good guideline is to have comfort * standard deviation^2 / win rate.

Standard deviation is fairly constant for single table tournaments, about 1.7 buy-ins for 9 or 10 player SNGs. The standard deviation for multitable tournaments rises with the number of players in the tournament, and depends a bit more on your style. The standard deviation for a 180 player tournament may be about 5 buy-ins.

Win rate should be expressed in the same units as the standard deviation. Express both in buy-ins, or both in percent, or both in $. Your win rate has to be positive for the formula to make sense. Bankroll management is for winning players. A bankroll will not give you the skills to win.

The comfort level you require depends on your personal risk tolerance and ability/willingness to move down when you hit a bad streak. A comfort level of 2 is usually considered aggressive. A comfort level of 4 is usually considered conservative. If you play at your current level without withdrawing any winnings, your risk of ruin is about e^(-2*comfort) ~ 1/7^comfort.

Suppose you have a ROI of 20% in SNGs with a standard deviation of 1.7 buy-ins, and set a minimum comfort level of 3. The bankroll you need is 3 * 1.7^2 /0.2 = 43 buy-ins.

Suppose you have a ROI of 50% in MTTs with about 300 players with a standard deviation of about 7 buy-ins, and also use a comfort level of 3. The bankroll you need is 3 * 7^2 / 0.5 = 294 buy-ins.

Since you probably don't know your win rate, you might not get an exact answer, just a range of estimated bankrolls. That's fine. Note that as you move up to higher stakes tournaments, your ROI will probably drop, so the required bankroll in buy-ins will increase. If you are playing lower stakes tournaments than your role models, you may have a higher ROI, and you may not need as many buy-ins to be as safe.

[batair]

Thats good advice pzhon but i think it might be a little to complicated for most new players to understand.

Nelob if you are a losing player like pzhon said bankroll doesn't matter just deposit what you can afford to lose.If your a winning player i would play with 50x-100x the buy in depending on how good you are.So if your playing $5 trnys anywhere from $250-$500.

[scpi10]

You should also factor in how easy or difficult it is to reload your account if you hit a bad downswing. If you live in the US and it's hard to deposit money, you might want to be more conservative with your BR.

[Nelob]

I don't deposit, I entered a freeroll on fulltilt poker that was payed for by this poker site I am a member of. It was for $615 dollers and now I am up to about 800. What do you recommend.

Is there different amounts you need for MTTs compared to SNGs.