Bankroll management in poker is one of the main factors that distinguishes a gambler from a player. Properly segmenting and managing your bankroll is so crucial to long-term winning play that we made it the first topic in the advanced poker-strategy articles and review it independently of the section on poker math.
The following quotes are from the special features of the movie Rounders from two professional players with very different styles:
“Don’t play over your limit if you can’t afford it. That’s very important. I see a lot of players sit in the big games. They know they can’t afford to be in that game. They put their whole bankroll in the game, and they play scared. They’re not playing their game. They’re just throwing their money away.”
Over the short run, there’s a huge amount of luck in poker, but over the long run, you really have to be an expert to do well. So many players fall into the temptation of trying to accomplish a lot and risking too much. You can be a great poker player and go on an unlucky streak, and if you’re not very, very careful about managing your money, you’re gonna lose it all.”
Bankroll Management Principles
Principle 1: “Do not play with money you cannot afford to lose.”
Principle 2: “Always have an absolute bare minimum bankroll of 15 times the table buy-in at your regular cash game and 50 times your regular buy-in for tournaments.”
Principle 3: “Adhere to a maximum loss-limit per session of 4 buy-ins in no-limit & pot-limit games or 75 big bets in fixed-limit: ~1/5th of a 20 buy-in bankroll or ~1/7th of 30 buy-ins. To be on the safe side, you could even drop this loss-limit to 3 buy-ins for NL/PL games and 50 big bets for FL.”
How to Choose a Limit (Poker Stakes) for Your Regular Poker Game
The reason for bankroll management is “variance“. Put into terms everyone can understand, variance is the mathematical certainty that shit can, and most definitely will happen.
In addition to the Bankroll Management Calculator used in the video above (for multiple game types and strategies employed for both cash games and tournaments), visit the poker-strategy shop to check out the Profit-and-Loss Excel Workbook that spans over 5 years of play for tracking your game like a professional card player at online and live card rooms.
Here’s a concrete example of why you should always practice bankroll management. In this hand between Daniel Negreanu and Gus Hanson, Daniel is ~80% ahead pre-flop (a standard overpair/underpair scenario) with his 66 vs. Gus’ 55. However, since they’re playing so deep-stacked, the pre-flop equity match-up is relatively unimportant … it’s all about postflop play when big and deep stacked.
They flop middle and bottom sets, which is itself highly unlikely; when you know that two players hold pocket pairs, they will both flop sets only 1.018% of the time, i.e. the odds against this flop were 97 : 1. Daniel’s over set on the flop is a 95% favorite and Gus is (unknowingly) on a 1-out draw (i.e. ~5% completion probability by the river). Gus hits the one card in the deck that can help him on the turn and Daniel is now on a 1-outer himself with ~2% equity left in his hand. This is proof, that there is almost never a flop in Texas Hold ’em where you don’t need to “protect” your hand.
The 8s on the river completed the straight for anyone holding 77 and also means that overpairs and even A9 could still be good in some scenarios … potentially also something that Gus would bet and a scary board that he might even make a pure bluff on. A pair of 99, 88 or 55 were the only holdings that beat Daniel’s full house, so he makes the call (also probably because he knows that Gus could bluff such a board).
Long-story-short, arguably one of the best players in the world took a huge bad beat in a pot of over $575K. If it can happen to the pros, it can happen to any of us. Variance is ever-present, so make sure your bankroll has the padding to handle the swings.
Here’s a similar example with the tables turned where Gus takes the bad beat from Daniel. Always be mindful of the “V-word” (variance) and know that a “big hand” means 2-pair or better, definitely not a “good hand” of top pair with a good kicker or even, as is the case below, an overpair.
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