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Old 10-12-2017, 06:37 AM   #1
Cfoye
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2 questions related to value

If I buy into a 50k game and the winner receives 200k (total prize pool) and there are 5 players, is the rake that I am paying for this 20%




Second question.
If everything was the same as above but the prize pool was 300k to the winner would I be getting a 10% reverse rake (or positive rake)?

Last edited by Cfoye; 10-12-2017 at 06:47 AM.
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Old 10-12-2017, 12:00 PM   #2
whosnext
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Re: 2 questions related to value

There is no single set-in-stone universally-agreed-upon method to calculate the rake (expressed as a percentage) in a poker tournament. There have been, and will continue to be, lengthy discussions as to the "correct" way to calculate rake as a percentage of entrance fees in poker tournaments.

Having said that, most people would say that the rake in your first example is indeed 20%. Each player pays 50K to enter the tournament and 10K of the 50K goes to the tournament organizers in rake rather than prize money; 10K/50K = 20%. (Equivalently, difference between total player entrance fees and total prize pool, expressed as a percentage of total player entrance fees, is (250K-200K)/250K = 50K/250K = 20%.)

In your second example tournament organizers add money to the prize pool, over and above what the players paid in entrance fees (such as overlay when a guarantee is not "met"). I think in this case it is better to think of the overlay as a percentage adder to the overall prize pool rather than try to express anything in terms of per-player (though the algebra may be equivalent).

So in your example, total prize pool is 300K, total player entrance fees is 250K, so overlay is 50K. Expressed as a percentage of the total player entrance fees, this would be 50K/250K = 20%.

Last edited by whosnext; 10-12-2017 at 12:06 PM.
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Old 10-12-2017, 12:20 PM   #3
Cfoye
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Re: 2 questions related to value

thank you kind sir. Your confirmations are very valued
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Old 10-12-2017, 01:01 PM   #4
RustyBrooks
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Re: 2 questions related to value

I'd call the first example 25 percent. Your entry is 40k and you're paying 10k in rake. I can see an argument for either number though.
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Old 10-12-2017, 09:32 PM   #5
Cfoye
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Re: 2 questions related to value

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I'd call the first example 25 percent. Your entry is 40k and you're paying 10k in rake. I can see an argument for either number though.
I first thought that too and then I started seeing it from different perspectives and formulas and I became so confused that I thought I was losing it. Maybe both answers are correct but it all depends on which side you view it from.
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Old 10-12-2017, 11:18 PM   #6
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Re: 2 questions related to value

I've thought about this a few times today. I actually think whosnext's way is more consistent. Think about it from a cash game perspective.

You scoop a $100 pot and pay $5 in rake. In a cash game everyone calls this '5% rake' because it's 5% of the pot. They don't say, well, really, it's 5/95 because you get 95 and the house takes 5.

I dunno. To me if I sign up for a $10+$1 tournament, that "feels" like 10% rake to me, but I could be convinced either way. The important thing, I think, is that you're just consistent with your tabulations of win and loss. The actual percent is not important, so much as to know how much is being give to the house, and how much is up for grabs.
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Old 10-13-2017, 01:16 AM   #7
Cfoye
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Re: 2 questions related to value

It’s very interesting in that I’ve always just auto assumed $10 + $1 to win $100 is 10% rake as well but when you really break it down in a more logically consistent way then the answer becomes -$1 of $11 = -0.909%
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Old 10-14-2017, 03:17 PM   #8
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Re: 2 questions related to value

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Originally Posted by whosnext View Post
There is no single set-in-stone universally-agreed-upon method to calculate the rake (expressed as a percentage) in a poker tournament. There have been, and will continue to be, lengthy discussions as to the "correct" way to calculate rake as a percentage of entrance fees in poker tournaments.
What other methods do a significant number of people argue for? Calculating rake seems clear cut to me.

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I'd call the first example 25 percent. Your entry is 40k and you're paying 10k in rake. I can see an argument for either number though.
So if you play a 20+20 (let's say it's for charity or something), you're paying 100% rake?
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Old 10-14-2017, 09:16 PM   #9
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Re: 2 questions related to value

You can view the rake a an extra on your buyin, in which case, yes, you're paying 100% extra in rake.

Or you can view it as a percent of the whole, and then you're paying 50% of the whole in rake.

Those are both the same amount of rake. Like I said, as long as you're consistent in your book keeping, it's fine.
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Old 10-15-2017, 06:00 PM   #10
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Re: 2 questions related to value

I think there are two examples of rake (upfront vs total pot amount) and might not be equal. Because before you enter each pot in a cash game, the amount of players that will invest into the pot is not set, compared to say a 5 player SNG that doesn't start until the 5 seats are filled — and rake is established upfront.

Say for example a 6max cash game.

And let's say in this cash game you enter the pot as the second player, and there is still 4 players behind you to act, — the pot amount which the dealer will be deducting the 5% rake from is not set when you entered the pot — compared to the 5 player SNG.

So 50k rake divided by 5 players = 10k, that each player paid in rake upfront, which = 25% — this might be different to say a cash game where rake deduction depends on how many players enter the pot after you.

Does this make any sense?
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Old 10-16-2017, 06:11 PM   #11
Cfoye
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Re: 2 questions related to value

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Originally Posted by ajikavix View Post
I think there are two examples of rake (upfront vs total pot amount) and might not be equal. Because before you enter each pot in a cash game, the amount of players that will invest into the pot is not set, compared to say a 5 player SNG that doesn't start until the 5 seats are filled — and rake is established upfront.

Say for example a 6max cash game.

And let's say in this cash game you enter the pot as the second player, and there is still 4 players behind you to act, — the pot amount which the dealer will be deducting the 5% rake from is not set when you entered the pot — compared to the 5 player SNG.

So 50k rake divided by 5 players = 10k, that each player paid in rake upfront, which = 25% — this might be different to say a cash game where rake deduction depends on how many players enter the pot after you.

Does this make any sense?
yeah it does and it's something i didn't think about so thanks for sharing. I personally like the calculation done as a whole and not from the buy in amount. i'll attempt to reason why. if i have two apples and i gain two more, than one way to look at this is to say i have made 100% gains. The problem with this way is if i then lost two apples i wouldn't say i lost 100%. You'd say i lost 50% of my apples.

if you always make your calculations done as a whole then you won't have these drastically differing percentage changes that can mess around with your perception. You would simply have 50% gains when the two apples are added and 50% losses when the two are taken away. Much more neat and gives you a better idea of correct magnitude and proportion.
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Old 10-16-2017, 10:16 PM   #12
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Re: 2 questions related to value

Well, one problem there is that the absolute standard way to say that is that you gained 100% of apples and lost 50%, even though the absolute quantity is the same.
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Old 10-16-2017, 10:25 PM   #13
Cfoye
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Re: 2 questions related to value

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Well, one problem there is that the absolute standard way to say that is that you gained 100% of apples and lost 50%, even though the absolute quantity is the same.
even though it is not following the standard is it actually incorrect to say 50% gains? i'm asking cos i'm not sure
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Old 10-17-2017, 07:43 AM   #14
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Re: 2 questions related to value

A percent is a fraction. 50% means "50/100 of something"

So when you say 50% gains... 50% of what? You gained 50% of the amount you had after you gained it? This is... true in a sense, but a very awkward way to express the quantity.

But like I've said through out this thread, as long as you don't accidentally mix and match different defintitions for your percentages when doing math, it will come out the same.
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