Why do 99% radically overestimate their edge?

I vividly remember “back in the days”, when two friends and I went on a trip to Rome. First of all, after to Vienna, Rome is still the second most beautiful city I have ever been to. I´m talking from an architectural and aesthetic point of view. If you love buildings and have some sense of romance, this is a place to go. Forget Paris. You will probably like Paris, too, if we have similar taste. I like Paris a lot, but for different reasons. But it’s a big secret to me why Paris is the “city of love” and why every couple dreams of getting engaged there. Have no freakin clue. It’s one of those “everybody says it, must be true”. 1 Million ants can´t be wrong, crap tastes good!

Rome has a plethora of old fountains, antique monuments (and whatever is left), the Vatican. Going out on a warm summer night…sitting at Spanish steps, drinking wine and see vendors selling flowers on the streets.

Most people would also agree that the Italian women are among the hottest. Needless to say, its not a big secret that if you want your wife/girlfriend to cheat on you, just send them a week to Italy. Enough fluff for today.

Here some pictures. Those are from thousands!!!

Not the most beautiful, but fascinating city in the world still stands to be my old and everlasting love, New York. Just love the “spirit” of the city. My dad always used to say that he can “smell” cities. Each city has a different smell to him. I´ll go with spirits. None of that hocus pocus stuff. I feel different energies in cities. Haha, not “spirits” but “energies”. Well, whatever words we use to describe what we feel, some people will be able to relate, others not. I´m curious how else people differentiate cities… So far we got, “smell”, “energy”… feel free to comment what your preference is…

On topic:  HOW BIG IS YOUR EDGE ?

Year 2007, one day we were playing poker in the casino over in Vienna. At that time, I completely underestimated the power of rake. It was – needless to say – at the time when I used to play tourney and only a few cash games. Whenever I saw somebody make a bad play (= a play that I wouldn´t make, haha… you see how stupid I am/was ??? ), they´re not only mentally marked in my brain as a huge fish, but also increased my edge infinitely on the table. If the best poker players in the world at that time would have sat down, there was no way I was quitting. Overall that guy´s playing terribly, right?

We sat in a 2-5 Euro game, around 500-1000 stacks and at that time this was as high as I ever played. My friend, a cash game player for 2 years, suddenly quit the game when it became 3 handed. I had no idea. He baffled some stuff that every player left is – EV. I just thought he was a huge nit.  By the way, he was a huuuge nit. He wouldn’t go blindly all-in in a 5$ rebuy, when everybody was more or less goofing around. At that time, he was the type who would invite and pay for friends for dinner & drinks, but if you owed him 1,20 Euro, he´d make sure you payed it.  If you think that’s weird, it seems so, but it isn´t.  In his mind he completely separated the two things from each other, which many people wouldn’t. Ok, you have a slight idea of him.
He quit the game, despite one “bad player” and one mediocre young guy sitting next to us. I kept playing some, booked a win and was completly sure that I’d made a smart decision.

RAKE & Live games:

Poker can be deceptive. Results can fuck your mind. Especially good results. Today I´d laugh at anybody in my seat who was there to “make money”. If you´re playing for the fun, hey, no problem. That’s not forbidden and it’s a fair choice.  But if you think you had a reasonable edge with the 5% uncapped rake, and expect to clean out the game, it’s safe to assume that you´re completely disillusional about your poker edge. At least I can say this about myself. Let me use one quick math calc to illustrate my point. Of course I am working with estimations and you have to tweak and fiddle around. And of course, there can be cases where 5% uncapped can be +EV blabla… but it’s the exception to the rule.

Situation: (PTBB always means PTBB/100 Hands)
Live game, Limit: 2-4$,
9 handed:

2 fish (each -15PTBB, which btw is REALLY hard to play this bad)
5 nitty mediocre players (-1PTBB)
2 Sharks (+ x PTBB )
Stacksizes: Have huuuge effect on winrate, should be obvious

It is commonly “agreed” that usually the biggest edge you have is around 60-40, IF Villain is completely out of his mind. If Villain has some sort of knowledge it reduces your edge extremely. 60-40 means, that you´ll get your money in as a 60% favorite on average at best.

Rake: 5% uncapped, lets say it’s 2PTBB/100 from each player on avg, tips included. This is an extreme underestimation. If math proves me wrong, then show me the player who can consistently lose 15PTBB in a fullring game. I already used the most optimistic numbers, keep that in mind, those kinda fish are rare.

Calcs-Conclusion:

There are 35PTBB to win from fish and bad players, minus 18PTBB rake = 17 PTBB . Split them among 2 players, and you have a 8,5PTBB winrate. (Doesn’t seem bad, right?)… BUT:

If you´re really gods gift to poker, you can have this winrate. And some actually have. We´re talking about the 0,0001% of players. Now let’s see what their hourly is… 20 Hands, so this will lead to around $16/ hour. So you´re one of the most talented players out there, you´re in a pretty juicy line-up, and your hourly EV is $16. CONGRATULATIONS!!!!
Every NL 50 online multitabler can make this much in Rakeback alone, playing 24 tables.

Perceived Edge:

Listen close, whenever poker players talk about fishy games, it seems like you´d be making millions there. Up to this day – and I´ve been around at least a bit – 99% of those games did not exist. With “not-exist” I mean the degree of softness. Often people exaggerate a lot, but I´m not even assuming this is the case in our example. What usually happens, you hear the weirdest stories, the most retarded plays and when you go there, there´s a bad player who completely fits that description, but 8 other players like you, waiting to milk him. But most of the time, even the guy who calls any pair has some sort of equity. That’s not new, but if you WON 10 stacks from them, then because you were running extremely good means you won all your 60-40 ies.

As you can see, we have made a LOT of stretches and assumed the worst of the worse. The outcome still looks at best mediocre. I apologize in advance, if my numbers are off somewhere. Wanted to invest time in writing this article, not in going back to math school.  But I hope you can see through this and conclude that it really doesn’t matter. Even if you make $50/hour at that table, it’s probably not “as sick soft” as you would have thought. Or lets say, the people who talk about those games think their edge is bigger, which is – as we see – a big illusion.

The deception of playing live poker:

Nothing new, but a live player usually has an extremely small sample size. And being human, he will have no other choice but to either completley overestimate or underestimate his poker skill. The best players in the world have “run bad” over 10.000 hands. You´ll need approximately 500 hours of live poker to go through this phase. Most people are already broke or quit by that time, despite maybe being the best player in the game. What’s new? Variance is a bitch. But this is exactly the reason why I personally don´t take live players too seriously when they talk about edges.  I´m not saying they are less smart, and if you put me in their shoes, who knows what I´d say. But with the knowledge of statistics and experience of having played over a million hands, one gets a different perspective. Not the “I know it all” , but the “I´ve seen too much to believe this” – attitude.

Lesson of the day:
BE SKEPTICAL,   NO GAME IS AS SOFT AS ITS MADE !

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