Losing at VP – Part 9

More from 2001

5.  Have an adequate bankroll. This brings up one ugly word in the video poker world—“volatility.”  Probably the closest mathematical term to describe volatility is the term “variance.”  How much can your winning and losing sessions vary from the “average” expected return?  I like my non-mathematical real-life description – I call it “the roller coaster effect.”  Since so much of the return of any video poker game comes from the top jackpot hands, an infrequent occurrence, you must have enough money to “survive” between the jackpots.

 In the sequel to The Frugal Gambler, which I’m currently finishing (it’s due out in the fall), I’ll cover this subject in depth, with charts by math experts who determine by computer calculations the necessary bankrolls for various games at different levels of certainty. For now, though, I can generalize by saying that you can have a smaller bankroll if you can handle a 75% “risk of ruin (ROR),” the mathematical term for “going broke” before reaching the long term.  For us conservative (read that – scared) sorts who want to be surer, the bankroll figures will surprise, even shock.  [More Frugal Gambling can be ordered at queenofcomps.com] 

I’ll give you one mind-numbing example, for a “good” game.  To play quarter Deuces Wild [classic schedule]—and you have to play perfectly—with no added cash benefits, you must have $8,800 to have only a 1% ROR.

Are you discouraged already?  Jump to number 6 fast!

[I’m going to be cruel here and not give you #6 in this entry.  I’m going to let you ponder this before I post Part 10.  Think about what the bankroll must be if you aren’t doing a play nearly as good as 100.7%!]