Exploiting Rake - Win Rates & Rake Theory
In Exploiting Rake Part I we overviewed rake and how it drives the strategies that online poker rooms use to fill the player pool with the player types they want. This knowledge can help players choose the poker site that will be the cheapest or most profitable for them. In this article we'll now look at how rake affects game selection.
Online poker is a peer to peer game. You've heard the saying 'the house always wins', but that doesn't apply in poker as you're primarily competing against other human opponents, making it a game of skill.
Your true winrate is simply the gap between your skill and that of the other players.
Poker ability is not just technical; it includes such things as emotional stability, bankroll management and diligent note taking. Short term variance aside, the gap between your ability and your opponents' will determine your win rate. How much of that you take home then depends on the rake.
True winrate is how much you would win from your opponents if rake were zero. Cash games winrates are expressed in big blinds per hundred hands (bb/100), or big bets in fixed limit games (BB/100). If you're beating the table for 10 bb/100 playing 50NL cash but paying 8 bb/100 in rake, your net winrate is 2 bb/100. Net winnings are then calculated by adding rakeback and/or VIP benefits.
In tournaments it’s conventional to use Return on Investment (ROI) - this will be the subject of a separate article.
The level of rake in a game determines how much of a skill edge you need in order to profit. Not only do you have to beat the other players, you have to beat the rake - if rake is too high, the game becomes unbeatable. In general the more rigid and 'mathematical' a game, the lower the achievable win rate. For example, average win rates in NLHE are higher than in LHE, but lower than those achievable in PLO.
In LHE for example 1BB/100 would a strong winrate at midstakes, and 2BB/100 considered world class. In NLHE players often aim for 4bb/100 before considering moving up in stakes. Winning PLO players achieve 5bb/100 or higher over large samples.
Achievable winrates in any game also increase the deeper effective stacks are. Shortstackers hope to breakeven and derive most of their winnings from rakeback, whereas 100bb players exploit opponents much more post flop. Similarly the ROI achievable in huge field Multi Table Tournaments (MTTs) is higher than standard Sit & Go Single Table Tournaments (STTs). The sustainable win rate in 6 max hyper turbo STTs is even lower.
As stakes increase, there is an inverse relationship with possible winrate, because the average gap between winners and losers naturally narrows.
To tie this together let’s look at some real rake figures. Below are the figures for rake being paid in bb/100 at $0.05/$0.10 Pot Limit Omaha games from earlier this year.
iPoker rake is $0.01 for each $0.15 in the pot from 2 - 10 players with a $1 cap - equivalent to over 6.66%, drastically affecting the profitability. You'd need to beat the table for ~30bb/100 just to break even before rakeback.
Even ~20bb/100 is a much higher rake than that of No Limit games. Site reps have rationalized this as PLO being more of an action game, with larger pots and higher achievable winrates, however PLO rake is still a cause of much controversy.
In response to player complaints that microstakes PLO in particular had become unbeatable, PokerStars recently announced separate rake tables for PLO. The new rake structure is significantly lower than that at any other room.
|Stakes||% Rake||2 Player Cap||3-4 Player Cap||5+ Player Cap|
All the major sites make their rake structure available online. When choosing a site it's important to analyze rake collection methods - e.g. true percentage rake vs the incremental method - and cap sizes. Below is the No Limit and Pot Limit rake structure for cash games for PartyPoker.
|stakes||Number of Players||Rake @ Pot Size||cap|
|$15/30 & Above||2 to 3||$0.05 per $1.00||$2.00|
|4 to 10||$0.05 per $1.00||$5.00|
|$0.10/0.25 to $10/20||2||$0.01 per $0.20||$1.00|
|3 to 4||$0.01 per $0.20||$2.00|
|5 to 10||$0.01 per $0.20||$3.00|
|0.01/$0.02 to $0.05/$0.10||2 to 10||$0.01 per $0.02||$1.00|
The maximum rake is known as the ‘cap’ and it is much more important than it appears. The effect of the cap is to reduce the % of rake taken. A cap of e.g. $3 at a $2/$4 cash game will be hit very regularly. If the rake is 5%, then the cap comes into effect at a pot of $60 (5% of $60 is $3). $60 is just 15bb, so many pots will be capped.
For example, let us take a common situation where, two players with full stacks go all in, one with AKs and one with QQ, creating a pot of 200 big blinds.
|Example||Blinds||200 blinds Pot Size||Rake||Cap||Rake as % of Pot|
At $2/$4, there is $800 in the pot. The rake is capped at $3, so $3 is paid. As a percentage of the pot, that is 0.375%. At $0.10/$0.25 there would be only $50 in the pot and at 5%, $2.50 is taken in rake. The rake cap is not reached, so the percentage of the pot taken in rake is the full 5%.
This shows the importance of the cap size for lower stakes players. Low stakes are often referred to as 'rake trap' limits and professionals aim to build a bankroll for higher stakes as soon as possible.
|Site||Stakes||Game||Rake (in bb)|
|PartyPoker||$2/$4||6-Max NLHE||3.77 bb/100|
|PartyPoker||$0.10/$0.25||6-Max NLHE||9.71 bb/100|
In PartyPoker online cash games, the rake at $2/$4 6-max NLHE averages 3.77 bb/100 (hands). The rake at $0.10/$0.25 6 max NLHE is 9.71 bb/100. So winning players at $0.10/$0.25 must maintain a true win rate of over 10bb/100 just to make a profit from playing. At $2/$4 a true win rate of 4 bb/100 is already profitable.
Heads up games usually have a very low cap even at high stake levels - if they don’t, change your poker site. PokerStars and Full Tilt use a $0.50 cap HU up to high stakes. Heads up is less profitable on PartyPoker with the $1 HU cap, opponent skill aside.
In the middle of the range, PartyPoker changes the cap at 2, 3 to 4 and 5 to 10 players. Players who routinely leave tables when they become short handed might want to think again. The cap reduction can make a big difference to your actual winnings.
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