Yesterday in the evening I was about to start a smallish session 
review. This year I played around 50k hands until now.
I looked at my graph and noticed 2 spots where i lost 10+ buyins 
already.

Just take a look yourself.

I should mention, that the 14 buyin downswing was within 1 day.
The next day I got back to grinding I played the red area on the 
2nd graph.

I took a closer look at the situations I lost alot of money in 
and noticed I didn't really misplay those spots. I ran set vs set 
multiple times and i had kings vs aces 4 times in the 14 buyin 
downswing alone.
I even folded Kings once vs a guy on whom I had a 2k hand sample and 
who didn't 4 bet once before the hand occured.

So after looking quite some time at the graph and reviewing alot of 
situations a new topic for my blog jumped into my mind:

 

Variance! We all love Variance!

 

Variance explained in General

In probablility theory and statistics, variance measures how far 
a set of numbers are spread out. At least that's what wikipedia 
told me.

"Translated" into "poker" it's the ups and downs of your poker 
graph.
It's the difference from your actual winnings to the part you 
"would deserve", may that be more or less than shown.

A quick example:

You are a winning NL100 poker player making 2bb/100 on average.
How do you know that? because u already played a shitton of hands
in the past!
In January you plan to play 30,000.
those 30,000 hands multiplied with ur winrate (2bb/100) 
results in an expected profit of 600$ for january, sounds great 
right?

Now let me tell you in ~37% of cases u will show up with a loss 
in January.
Sounds horrible right? playing 30k hands a month and showing up 
with a loss?
But in 37% u win at least the double of what was expected, 
right 1200+ bucks.

That's just how crazy variance is in the short run (30,000 hands)
Later we will see what we can do (or can't) to impact variance.

 

 

Chess vs. Blackjack/Roulette vs. Poker, may the best player win!

 

As long as "the best" chess grandmaster is allowed to begin the 
match as White he is not expected to lose one single game unless 
he makes a major mistake.
Sure, you can be lucky that your oponnent has a bad day, didn't 
sleep well, is drunk or random other stuff bothering his mood. 
But on the battlefield of chess u will not find luck! White has 
the edge of starting so black is doomed to lose. I always saw chess 
on grandmaster level like a match of tic tac toe, only the guy who 
begins can win. the other guy just has to defend and only can hope 
for a tie (well tic tac toe should always result in a tie)



Roulette and Blackjacks are games in which you are doomed to lose
(unless u can cartcount which is illegal so I'm just ignoring that 
part) thanks to the edge the house has over you.
There are strategies to not lose as much, and to be more likely 
to have a winning session. With those strategies you lose less than 
someone playing random stuff but in the long run you always lose. 
Even the best players in the world will lose!


Now lets look at poker. The majority of people without a deeper 
knowledge of poker would consider it to be pretty much on the same 
level of luckbased games such as roulette and blackjack. 
Others, even alot of chessplayers, saw a chance in getting good at 
it and a few of them moved over to play it for a living.
Where exactly is poker at now?

Poker is kinda inbetween. The best player in the world can have a 
losing day even tho he played good and a guy who never played poker 
before can take off money from a pro  even tho he doesn't really know
 what he is doing.

Sure, The guy who is getting the money in for the better will win 
in the Long-Run, but he can't be certain to take a profit in a single 
session.

Only the Long Run matters!

Different kinds of variance in Poker

All, most poker players think about when they hear the word 
"variance", is "Expected Value" (short ev) (i will not explain it 
here since everyone knows what I'm talking about). But there is much 
more that has an impact on variance.

Some of it is very obvious and other stuff is hidden and hard to 
notice.

What alot of people don't know is that the worst downswings happen 
when more than one of the following aspects take place at the same 
time.

Did you ever wonder about your downswings in which your "orange 
line" (EV) went down with your winnings? It is not necessarily because 
you played bad, it might be because of the following:

Holecard Distribution:

 

 

This only aplies in very short examples and will balance out the 
fastest.
In the Long Run it has no big impact on ur winnings.
The Long Run for your Holecard Distribution will be reached very 
fast online and is more of a live poker problem!

Example: 

Did you ever check your database for the pocket hands that won 
you the most money?
If u have more than 3,000 hands Aces should be at the top and 
nothing even comes close in terms of $ won!

In a good live game you get dealt 30-40 hands per hour.
Let's calculate with the maximum so 40 Hands!
You get aces 1 in 221 times, let's simplyfy it in our favor again 
1 in 200!
Even tho math wasnt my best subject in school I calculated you 
should get aces once every 5 hours on average.
Now consider you go on a thirsty streak of 500 hands in which u 
don't get your
biggest winning hand. That*s 12.5 hours of playing poker!
(this is not a horrible example, this happens fairly often)
Remember that number 12.5 hours! (with very favorable situations)

Situational Badluck:

I will just continue with that example.

So you were unlucky and played 12.5 hours without aces, finally 
you get them. American Airlines! YEY! Sitting in the bigblind, you 
already made big plans.
trapping someone? 3bet? Jam? What is your plan?
Congratulions you just won the Smallblind, happens! OK lets not be 
that negative!
I mean you were waiting for 12.5 hours + you already were way to 
unlucky, it's just impossible to be folded to you right now, right?

Ok you get the well desired (and deserved) 3bet in and get called by 
the SB. 
Wonderful!

Flop comes down KsKhQs, so what? You have a nice hand with Aces, 
it's very unlikely villain has a King and your Range has alot of 
kings in it so you Cbet. 
SB calls.
Turn Qh. 
It's livepoker and you put all your effort in not making a weird 
disgusted/angry face right now. But you know what! No problem, 
you are still in position!
Let's look how villain reacts.
Oh damn, smallblind all of a sudden jams (goes all-in).
But hey, you have a read on him, you know he would only jam his bluff 
in that spot.
He would trap you with all his boats.
You snapcall (no you are not on tilt)! He turns around deuces. 
Yeah buddy! Good call!

Running behind ev (the obvious one, this impacts your orange line tho)

Well the example is not done yet! The rivercard is still to 
come. Guess what! Bam, there it is the 2s!

You just got your money in with infinite expected value
(well or at least close to it!) and your graph is skyrocketing! 
But well, shit happens, the money gets moved into Villains direction.

Example Conclusion

-So you waited 12.5 hours and sometimes you just get the smallblind. 
 (and thats the best case in our example right?)
-You waited 12.5 hours and needed to fold on a very aweful board.
-You got your money in for the best and still got sucked out 
 afterwards.
But that's just what happens in the most aweful of days. 
Everything goes wrong, let me show you a very well drawn picture 
(paint skillz)
I hope you get what i want to show you!

Things you can do when variance hits you hard:

play through it

If you know you are dplaying well and your gameplan works in the 
long run just keep on playing, you are doing nothing wrong! Stick 
to your plan and I promise you better times are going to come.

Don’t look at your graph

Not looking at my graph, cashier, or anything money related really
helped me stay focused.
I do not feel the need to "catch up" when i am behind ev or have 
losses for the day. I can just stick to my gameplan and think every
decision through. I just recently noticed even when I started well 
and am running good I lose focus. I see I am up 4 buyins already and 
usually from that point on i will not get any higher. When I'm not
 checking my graph all the time i do better and am sharper!

Bankroll management

Having a solid bankroll that can cover all of the veriance is key.
Right after the pokerboom everyone suggested to have at least 20 
buyins for the limit you play. Times changed, Poker got tougher 
so by now I suggest to have at least 40 buyins!

Tighten up and dont push every little edge

To tighten up and to not push allin as soon as you see a 51% equity
situation might cost you some money in the long run, if things don't
go to well both of them will lower the variance.

Increase your Edge

The higher your winrate the smaller your swings.
So learn as much as you can, especialy in tough times, it will pay 
off in a big way, you will have a smoother winning graph and alot 
more money in your bankroll.

Play lower limits

If u ever reach a point where u feel mentally destroyed, go down 
a limit and play in an easier playerpool. It will help your confidence 
and your bankroll.
Once your mindset is back to normal you can return to your current 
limit.

Check your ranges or focus on a small detail

This is another trick to outsmart your mind. Whenever things go really
wrong I set my focus on small details. I will continue to play the way
I usually do and set my goal one something small like " raising more
on the button" or i just check my rfi or vs rfi ranges (and even use 
sheets for that). 
It just takes my mind away from running bad wich adds a few extra 
Dollars due to staying calm.

 

Interesting Concepts (google them)

• Sklansky Dollars
• G-Bucks

Final Statement: Variance – Good or evil?

We need variance, and we need it hard. Variance is what keeps
the fish depositing over and over again. If they wouldn't win 
a big pot from time to time poker would be dead for ages already. 
So see coolers as some kind of business investment. Whenever they
hit their 2 outers on the river (remember our example) have a smile 
on your face and complement them for their good plays and always 
remember he feeds the economy and you gain from it!