This is the seventh installment of my weekly poker column in the Economic Times, Range Rover.
‘In the long run we are all dead,’ John Maynard Keynes once said. Poker players are tormented by this truth. To a far greater extent than in other sports, they depend on the long run for their skill to manifest itself. But damn, it takes really long to come.
Let me illustrate that with a thought experiment. Say you run three tournaments, of tennis, chess and poker, with 100 recreational players of equal ability in each. The chance of any random player winning the tournament would logically be 1 in 100 times, or 1%. If you remove one player from each tournament and replace him with Rafa Nadal, Magnus Carlsen and Phil Ivey respectively, what would their chances be? Barring injury or natural catastrophe, I think it would be fair to expect Nadal and Carlsen to win their tournaments 100% of the time, maybe 99%. Ivey would at best win the poker tournament 5% of the time. That’s actually optimistic, and represents a return of five times that of the average player, but an alien watching the tournament from outer space would have no way to tell who the best poker player in the world is.
This enhanced role of luck is what keeps losing players playing – every dog really does have his day in poker – and makes the game so juicy. But it means that skillful players have to do something about that damn long run. And there’s only one thing to do: to play as much as possible, so that the long run comes closer. In poker terminology, this is called ‘putting in volume’, and every professional poker player could practically chant this mantra to keep himself going: Om Namah Volume.
This is why online poker is such a big deal. From the recreational player’s point of view, it allows convenience and ease of access – he can play anytime and anywhere he feels like. From a professional’s point of view, he can put in volume. In an hour, you will be dealt around three times the number of hands at an online table than a live table. Plus, you can play many tables at the same time. Therefore, if you are playing 10 tables at a time, you get dealt 30 times the number of hands than you would over an equivalent live session. This has two consequences. One, the long run is compressed, and variance (the role of luck) is evened out much sooner. Two, you learn much faster in this environment, as you are getting so much practice and exposure to situations.
Someone who grinds online multitable tournaments (MTTs) for a living will probably play 30 to 40 tournaments in a single night, and have around 10 tables running at any given time. To further counter variance, he will probably be staked by a staking stable, which will pay his buyins and take 50% of his profits. (This ensures a particuarly dry spell doesn’t wipe you out, and your stakers are usually expert players who also teach you out of self interest.) Indeed, the rationale behind running a staking stable is the same as that for putting in volume: ten people playing a collective 10k tournaments per month brings the long run closer than one guy playing 1k tournaments. To turn a tiny edge into a big profit, volume is essential.
Luck plays a huge part in our everyday lives as well. Being in the right place at the right time counts for a lot, and factors beyond our control will often determine the course of our lives. What’s the remedy to this? As the cliché goes, to try, try again. To put in the volume, and keep behaving optimally, even when the reward seems elusive. This is harder than it seems – Bloomberg recently estimated that 80% of all startups fail within the first 18 months, but even if you have the temperament to be a serial entrepreneur, how many businesses can you practically start till one works out? (In this context, VCs are equivalent to staking stables.) In poker, we can put in the volume and play millions of hands. In life, all we can do is keep trying and hope variance is on our side in the limited time we have. Unless you believe in reincarnation, in which case in the long run you’re just reborn.
Previously on Range Rover: