cyph
Trusted Member
COUNTER'S BANKROLL
Two bosses were once watching an aggressive black check player. One boss wants to back the player off because there’s clearly an indication of skill. The other boss disagrees, and comments/'This guy is a waiter across the street, he doesn't have the bankroll to play this high.” He believes that the player is outright gambling and treading on very dangerous ground.
From an industry standpoint, we must assume that every player is adequately financed; after all, we never really know how much money is behind any player. Many play to a pocket bankroll. When they lose, they go back to work for a couple of weeks, and they're right back again. It's one big game in this respect. For these players, their bankroll may turn out to be future income.
Determining how much money is needed to be a successful player is not an industry issue—we know that our bankroll is sufficient—but it is an issue with the player. In fact, it's a vital skill that must be mastered before he can be a contender. For completeness sake, here are some of the basics.
Unit Size is the Key
Bankroll requirements are usually discussed in terms of unit size. When Thorp first went out to test his famous system, he believed that $6,000 to $7,000 was adequate capital to bet $50 to $500. Revere suggested 120 units and playing until one had won or lost 30 units, or one had played for an hour, whichever came first. Humble suggested 50 top bets for true count wagering, and 100 top bets for betting according to the running count. Snyder likes to recommend a bankroll size that will fade two and three standard deviations of negative fluctuation. There are no hard and fast rules.
The bankroll can be any amount of money a player or team can afford. A team may start with a certain bank, say $50,000, and from there they will determine unit size based on some acceptable element of ruin. This is defined as the chance of losing everything before they double the bank. A mathematical formula might calculate that a 200-unit bankroll has a 10% chance of ruin; with 400 units, the element of ruin might only be 1%. Each player/team finds their own comfort zone.
Kelly Criterion
With any discussion of unit size comes the ubiquitous references to the Kelly Criterion. Developed by John Kelly in 1956, he proved mathematically that in any even-money proposition where the player always has an advantage, the fastest way to make money is to bet a proportion of your bankroll equal to your advantage, called the 'optimal bet size' (more formally, the optimal bet size is the players advantage times his bankroll divided by variance). To keep it simple, assuming a $10,000 bankroll and 1%
Two bosses were once watching an aggressive black check player. One boss wants to back the player off because there’s clearly an indication of skill. The other boss disagrees, and comments/'This guy is a waiter across the street, he doesn't have the bankroll to play this high.” He believes that the player is outright gambling and treading on very dangerous ground.
From an industry standpoint, we must assume that every player is adequately financed; after all, we never really know how much money is behind any player. Many play to a pocket bankroll. When they lose, they go back to work for a couple of weeks, and they're right back again. It's one big game in this respect. For these players, their bankroll may turn out to be future income.
Determining how much money is needed to be a successful player is not an industry issue—we know that our bankroll is sufficient—but it is an issue with the player. In fact, it's a vital skill that must be mastered before he can be a contender. For completeness sake, here are some of the basics.
Unit Size is the Key
Bankroll requirements are usually discussed in terms of unit size. When Thorp first went out to test his famous system, he believed that $6,000 to $7,000 was adequate capital to bet $50 to $500. Revere suggested 120 units and playing until one had won or lost 30 units, or one had played for an hour, whichever came first. Humble suggested 50 top bets for true count wagering, and 100 top bets for betting according to the running count. Snyder likes to recommend a bankroll size that will fade two and three standard deviations of negative fluctuation. There are no hard and fast rules.
The bankroll can be any amount of money a player or team can afford. A team may start with a certain bank, say $50,000, and from there they will determine unit size based on some acceptable element of ruin. This is defined as the chance of losing everything before they double the bank. A mathematical formula might calculate that a 200-unit bankroll has a 10% chance of ruin; with 400 units, the element of ruin might only be 1%. Each player/team finds their own comfort zone.
Kelly Criterion
With any discussion of unit size comes the ubiquitous references to the Kelly Criterion. Developed by John Kelly in 1956, he proved mathematically that in any even-money proposition where the player always has an advantage, the fastest way to make money is to bet a proportion of your bankroll equal to your advantage, called the 'optimal bet size' (more formally, the optimal bet size is the players advantage times his bankroll divided by variance). To keep it simple, assuming a $10,000 bankroll and 1%