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How to make decisions like a poker player

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Re: How to make decisions like a poker player

#121

Post by LargeWu »

m12k wrote: post #34

I attended a talk by Richard Garfield, the game designer behind Magic: The Gathering. He made a point that adding randomness to a game can be a way to give it that property of "easy to learn, hard to master", and in turn make it easier for a community to grow around the game. When you add randomness, it becomes possible for novices to sometimes beat more experienced players through sheer luck. Contrast that with e.g.…

Agreed. I've seen comments in similar threads in the past where people rag on games like poker or backgammon because they believe the randomness factor moves them from skill-based to luck-based.

In truth, managing randomness is actually one of the core skills of the game. Not just on the decision in front of you, but on future decisions as well. It's a hard skill to master. Moreover, the timelines to evaluate one's skill are long, sometimes hundreds or thousands of games, incorporating tens of thousands of decision points. It's not a wonder it's often misunderstood.

Re: How to make decisions like a poker player

#122

Post by dave7 »

lordnacho wrote: post #85
Raidion wrote: post #11

I'm a serious but hobbyist player with ~15k hands last month. The thinking like a poker player is mostly about being upfront about your risk tolerances and then having a culture supporting people who make the best risk adjusted decision, even if it doesn't work out. Expected Value is complicated because a 50% chance for $100 is the same as a 10% chance at $1000. It's the variance, not the EV that makes a lot of decis…

Where's the best place to play online? Non-US citizen.

Non-US? PokerStars, by a country mile. Always has been.

Re: How to make decisions like a poker player

#123

Post by UmbertoNoEco »

criddell wrote: post #82
totorovirus wrote: post #51

Well you can play millions of poker hands online. Life isn't like that. You have only ~30 years, and you have 30 * 365 = 10950 hands if we count each day as a hand. So what you need to work on is how you define "success" in life. Money is a high variance objective, whereas self-improvement is a low variance objective. I think finding a good balance of variance and tolerance to risk is a key to happiness.

30 years? Maybe your tolerance to risk is a bit on the high side...

High side? If I am understanding OP correctly he says one only has 30 years to "make it in live" or you're fucked and if I am understanding you correctly you think that is too high. If that is the case both of you are wrong.

Re: How to make decisions like a poker player

#124

Post by DennisP »

suzzer99 wrote: post #13
mettamage wrote: post #8

Earlier quoted context omitted.

> Not investing in ETFs after being burned by past downturns Helloooo Japan! ETFs are great, it will never happen to the US economy :) In other words, based on market behavior from multiple countries, it is definitely a possibility that ETFs won't return much in a period of 30 to 40 years.

And what's your alternative? Cash under the mattress gets killed by inflation. Gold has its runs but usually underperforms. Bonds also get killed in a downturn.

Diversification across asset classes.

Physical cash is terrible but to an investor, "cash" tends to mean something like t-bills, which over the past century have done slightly better than inflation. Gold is horrible if you have too much of it, but it tends to do well in equity crashes, so mixing in a little can be helpful. Bonds also sometimes do well when stocks go down, though I think that's more likely when you start at higher interest rates. Commodities can have 15-year bull markets independent of everything else. An investor in Japan would have done fine if they had a lot of foreign stocks. Etc.

Re: How to make decisions like a poker player

#125

Post by sumy23 »

Kelamir wrote: post #111
m12k wrote: post #34

I attended a talk by Richard Garfield, the game designer behind Magic: The Gathering. He made a point that adding randomness to a game can be a way to give it that property of "easy to learn, hard to master", and in turn make it easier for a community to grow around the game. When you add randomness, it becomes possible for novices to sometimes beat more experienced players through sheer luck. Contrast that with e.g.…

An alternative to randomness is handicap. For example, Go game has ranks and based on them either you or your opponent get a handicap. Equal ranked players don't use handicap. It is counted that a stone of handicap is worth ~6.5 points, and that is what's used in handicap - one player gets additional stones placed at the beginning of a match. The system is aiming to provide you with 50% win/lose percentage, and every…

The issue with a handicap is that if you win you don't feel as good because you know that the only reason you won was the handicap. It's harder to draw such a conclusion when you win due to randomness.

Re: How to make decisions like a poker player

#126

Post by DennisP »

beginnercounter wrote: post #24

The author sounds like a losing poker player. If my calling frequency is based entirely on pot odds, a good opponent would just start bluffing me out of every pot by increasing their bet size to a point where I can’t profitably call.

A good understanding of the odds is where you start though. If you don't have that, you'll certainly have no idea how to bluff optimally.

Re: How to make decisions like a poker player

#127

Post by tipsytoad »

mettamage wrote: post #3
ricardobeat wrote: post #2

I'm struggling to see how the advice applies to their own examples. Take Jane, who took a great offer but was hit by a recession: - potential reward of the decision: checks out - probability of getting it: 95% if you already have the offer in hand - resources (time/effort/money) to bet to get the reward: not significant Then there is 'imagining a bet' and 'analysing your past failures'. The first one might lead you t…

I think like a poker player, I skimmed the article. What they seem to fail to mention is that variance is important as well. In poker you need to play at least 10000 hands in order for variance to average down a bit. 10000 hands is still very little. So, if you have a 95% chance of going 10x that's great, but the question is: can you handle a 5% chance of having being potentially ruined for at least a decade? If not,…

I actually wrote a post about this, using a metric for expected outcomes instead of ev probability

https://tompollak.me/blog/ev-v-eg/

Re: How to make decisions like a poker player

#128

Post by listenallyall »

csa wrote: post #118
listenallyall wrote: post #88

Earlier quoted context omitted.

> has won at least four million dollars at tournaments alone. This is most certainly not true, because it doesn't subtract the cost of all the entry fees, to the tournaments she cashed and the dozens or hundreds she didn't. "alone" implies she has won additional money in non-tournament play, when there is no evidence she is a winning cash player. Finally, there is a LOT more to the Annie Duke story. Morally, ethicall…

> This is most certainly not true, because it doesn't subtract the cost of all the entry fees It is fairly standard in the poker world to discuss total winnings in tournaments rather than net winnings. When discussing net winnings, it’s usually discussed using an ROI measure (e.g., 30% roi over their past 100 MTTs between $1000 and $5000) rather than just dollars, since the biggest winners in dollars are almost all w…

> fairly standard in the poker world

But this is an article aimed at the general public.

Re: How to make decisions like a poker player

#129

Post by cthalupa »

bulbosaur123 wrote: post #12
mettamage wrote: post #3

Earlier quoted context omitted.

I think like a poker player, I skimmed the article. What they seem to fail to mention is that variance is important as well. In poker you need to play at least 10000 hands in order for variance to average down a bit. 10000 hands is still very little. So, if you have a 95% chance of going 10x that's great, but the question is: can you handle a 5% chance of having being potentially ruined for at least a decade? If not,…

> Put more extremely, if I offer you a 99% chance to take make one billion dollars (legally) and a 1% chance of being killed, would you take it? I definitely wouldn't. I would even if it offered 50+% of getting killed. The small chance you strike a billion is worth the risk.

It's a fun thought experiment under the many-worlds interpretation of quantum mechanics. Even at an infinitesimally low chance of getting the billion dollars, if the many worlds interpretation of quantum mechanics is true, you could argue that it is worth it from a selfish perspective.

In all the worlds where you get the money, your life is improved. In all the worlds where you don't, well, you're dead, so you don't really care.

Obviously, this doesn't take into account the impacts to everyone else in the worlds where you died.

Re: How to make decisions like a poker player

#130

Post by jvanderbot »

Raidion wrote: post #11

I'm a serious but hobbyist player with ~15k hands last month. The thinking like a poker player is mostly about being upfront about your risk tolerances and then having a culture supporting people who make the best risk adjusted decision, even if it doesn't work out. Expected Value is complicated because a 50% chance for $100 is the same as a 10% chance at $1000. It's the variance, not the EV that makes a lot of decis…

I imagine poker players don't use expected value. That's silly. You'd be all-in on a bet with positive expected value for no good reason.

They use expected returns in conjunction with size of current pot and size of current holdings.

What you say about variance is right on. It involves the payout and the odds and so on ...

They use something internally like the Kelly Criteria, probably tuned against their own model of what is the probability of each relevant outcome.

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