Every poker player, no matter how good they are, will experience periods of time where they lose money. These losses are caused by variance and can be avoided with bankroll management.
There are several different bankroll management strategies that differ in principle. These include the Martingale system, Fibonacci, Kelly Criterion, and unit systems.
Variance
Variance is a huge issue in sports betting. The best way to avoid it is by preparing in advance for large downswings. The concept of expected value (EV) in betting is similar to EV in poker, and it’s crucial for ensuring bankroll sustainability. Some online crushers play a high variance style that results in massive downswings, but they profit big year after year.
Whether you’re using a fixed unit model, a variable percentage system, or a confidence-based system like Oscar Grind or Fibonacci betting, it’s important to find a bankroll management strategy that works for you. Choose a system that helps you inform your bet amount, and stick with it.
Potential Return betting is an effective way to adjust your bet size based on the potential return of each bet. It uses the Kelly Criterion formula to maximize exploitation of value and minimize risk. It’s also easy to implement and can be a great starting point for any staking plan.
Betting intervals
A good bankroll management strategy protects you from the danger of chasing losses by dropping your stake size when on a losing streak. It also limits your reliance on luck or confidence levels to determine whether you should bet more or less. Keeping track of units and betting intervals is critical for this. There are several online services that provide these functions, including Poker Charts (pictured above), PokerTracker 4, and HoldEm Manager. However, anyone can create a simple spreadsheet to keep track of their bankroll and analyze results.
Another aspect of a successful bankroll management strategy is staying focused during extended sessions. This can be challenging, but practicing mindfulness and taking breaks between sessions helps prevent fatigue-induced mistakes. It is also important to set a point at which you will stop a session, such as when you are 25% underwater. This can help you avoid significant losses and maintain your winning streaks.
Stakes
Whether to play at high or low stakes depends on your poker ability, your tolerance for risk and how much money you want to make. Some players want to take a more risky approach in an attempt to move up the stakes faster, but this can be dangerous and lead to even the most skilled player going broke.
The basics of bankroll management in poker are that you should never play with more than you can afford to lose. This sounds simple, but it is hard for many people to follow. Many beginners will try to get back their initial deposit in one session by playing stakes that they are not ready for.
Having enough bankroll allows you to move up the stakes at a rate that is consistent with your skill level. This will help you build your skills and improve your chances of winning. However, it is important to remember that variance is a part of poker and you will experience losing streaks from time to time.
Limits
Bankroll management is the main tool that a poker player has to protect themselves from the negative influence of variance. It is not enough to simply play well, you also need to have money to reload your account when things go bad. This is particularly important for professional players who derive their income from poker and cannot afford to lose their money.
Even the best players experience big downswings from time to time, and without a large buffer they will eventually run out of money. This is why it is important to have a bankroll that is sufficient for the maximum stake you can comfortably play at. The general bankroll management guidelines suggest that you should always have at least 20 full buy-ins of the maximum stake you want to play. However, this is not an absolute rule and some players may need more. For example, if you have 30 buy-ins for the next level and you have more than enough to move up you should do it.
