Poker room math – how it works

English: Poker Room at the MGMG Grand. Lion Re...

English: Poker Room at the MGMG Grand. Lion Reservoir in the background (Photo credit: Wikipedia)

If you play cash games at poker rooms, there are two or three items that will reduce the amount of the pots that you can win.

Rake – the amount that the house or poker room keeps from each pot. For this example, we will take $1 from every $10 pot up to a maximum of $5 when pots reach $50 or more.

Tips – the amount that a player gives the dealer when the player wins a pot. For this example, we will assume that the player gives one dollar for each pot won.

Bad Beat – the amount that the house or poker room keeps from each pot for the bad beat jackpot. For this example, we will use $1 per pot. Generally a bad beat is when one players has four of a kind like 2222 and the other player has 3333 for a better four of a kind. Rules at each poker house will vary.

Let’s assume that there are nine players at the table and that each player brings $100 to the table to play for a total pool of $900.00 in play.

Let’s assume that each player receives 20 hands per hour.

Let’s assume that they all play for 5 hours or 100 hands total and no one rebuys when they lose.

Of the 100 pots won, on average 50 of them will have a rake of $2 taken for a total of $100.

25 pots won will have a rake taken of $4 for a total of $100.

25 pots won will have a rake taken of $5 for a total of $125

An average tip of $1.50 will be taken from the 100 pots for a total of $150

A dollar taken out of each pot for the bad beat jackpot for a total of $100

Results:

Starting players amount       $900

Less total rake amount         -325

Less total tip amount            -150

Less total bad beat amount   -100

Ending players amount         $325

Average amount remaining per player:  $36.11

Summary:

The effect of rake and tips is not immediately noticeable to the average player due to the fact that some players leave and new ones take their place, bringing new money to the table. Of course there are always those players that buy more chips and remain at the table.

Unless you are a winning player, it is virtually impossible to accumulate winnings when more than 40% of each players chips ends up going to the poker room and the poker room dealers.

Addendum:

I am a poker player and a poker dealer. I really appreciate my customers and the tips that they give us fellow dealers. I enjoy both the game and the challenge in spite of the fact that I do not play poker well enough to make a living doing it.

You could say that I love the social aspects of poker. As a player, I can relate to other players. As a dealer, I see the business side and relate to that as well. Some consider poker as part of the entertainment industry and I am striving hard each day to provide a service to my customers, the players.

And I hope that everyone understands that this is not a condemnation of the industry that I love but just an explanation of how it works. This post was the result of my thinking about the business side of poker that I wanted to share with you.

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4 thoughts on “Poker room math – how it works

  1. This is why I believe that there is no real reason to consider the ‘poker economy’. The ‘poker economy’ will continually be sucked back into the overall economy from whence it came. At some point, which I believe has already passed, the poker economy must reach a high point, and inevitably a taper downward. Eventually, it will reach an equilibrium where the people putting new money into the economy will equal the money that is coming out for rake and tokes. And by that point, we could probably include taxes from federal and state government on winnings and profits made by online cardrooms.

    • I agree. The food (money) chain is limited to people with money to spare. Since we are currently only recycling existing money, it will take time for the economy to rebound. Hopefully the poker industry will correct this both online and at the B&M facilities. 

  2. Online poker offers bonuses and rakeback or VPP points. All I am pointing out is the math side of poker in poker rooms and casinos. I really appreciate my clients tips and I thank them with eye contact when I do so. When I play, I always tip my dealers. When I cash out I even tip the cage lady. It goes without saying that I tip the wait staff, even when I am working. I give them $2 for the bottle of water that they charge .50 cents for. There foods prices are not high but I still tip. I give them $2.00 for the $1.00 cop of coffee and I thank them for serving me.  So this is not me telling my clients anything they already or should already know. If not being a winning player is a reason for stopping to play, I and my clients would have stopped a long time ago, I think. 😀

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