Learn about tournament entry fees, tournament ROIs, levels, blind increases, payout structures, and all of the other structural variables that a tournament host could simply decide on without rhyme or reason. Understand how each factor affects your profitability. Determine whether or not you want to play that tournament before you ever buy in.
Tournament entry fees (rake)
Let's talk about tournament rake or entry fees. The rake is the amount of money the casino takes from your buy-in as an entry fee. This section of your buy-in is not added to the final prize pool. A lot of our students at RiskOriented play live poker at a casino, but these games often have a significant rake.
In fact, I once saw a live tournament where the buyin was $25 and the rake was $25. That means half the money being invested into the game is being taken out of the prize pool. It's likely impossible to beat a game with a rake that stiff, even if you're the best tournament player in the world. In this game, you're betting $50 and only getting $25 worth of chips to start out, so you have to make up the other $25 in chips by taking it from other players in order to just break even. That's not easy to do.
A good tournament rake is around 10% of the tournament buy-in, which means for a $100 tournament, $10 goes to the casino (or less). There are lots of online tournament hosts that only charge 5%. Online, between 5% and 10% is common. In live poker, 10% to 20% is fair.
As tournament rake goes up, your return on investment goes down. Playing in a game that rakes 20% is actually more than twice as bad as playing in a game that rakes 10%. It's not just your 10% extra that's being raked, but everyone's (including the fishies'). The RULE OF THUMB I personally use is that I will not play in a game with a rake higher than 20% unless there are significant tournament structure considerations that increase the edge I have in the game.
Return on investment
The rake matters because it affects your return on investment. The interesting thing about tournaments is that your return comes over a very long time and it comes in large sums. For many tournaments, the money you invest will likely be a sunk cost, day after day, week after week. When you win one, which can be hard to do, especially in tournaments with thousands or tens of thousands of players, like the World Series Of Poker, you see a huge spike in your profitability.
In the graph to the right, you'll see it took the player 650 tournaments before cashing a significant profit with a first-place win. Because of his first place win, the player's ROI spiked up significantly, likely over 1,000% for all of the money he had invested all the way to that point. Had he taken second place, that line would only go half as high, and it'd be an ROI of 500%. Had he gotten unlucky at the final table and gone out fifth, he might have had an ROI of just 100% for his 650-game poker career. Still not shabby, but nothing like you see on this lucky player's graph. This graph illustrates that your ROI in a tournament poker game can be very swingy. It's hard to pin down your specific ROI. If you take a first place, it's going to skew your ROI high. If you don't take first place, it's going to skew your ROI low. That's the nature of the beast: the variance makes it hard to analyze.
To the left, a player swung up and down $180,000 over 1,400 tournaments before landing a significant cash. This is meant to be a cautionary tale. You should not play tournaments when you don't have a bankroll that can cover that tournament. Any money you put into a tournament needs to be treated as a sunk cost. We recommend having a minimum of 100 times the buyin to play a tournament with 180 to 300 people. You won't always lose your buyin, even if you don't win (cashing is often worth three or four times your buyin, and making a final table can be very profitable). This is a good estimate because the risk is so high compared to other forms of poker, where you can get away with only 20 times your buyin in your bankroll.
Your ROI for a poker tournament will vary depending on your skill levels, but professional poker players typically playing with a good mix of fish will achieve ROIs in excess of 100%. I often see ROIs between 150% and 200%, which means for every $100 you pay to play a tournament, a poker pro will win, on average, between $250 and $300. A pro's ~$200 profit then can be divided by the length of the tournament to calculate their actual $/hr while playing.
After completing the Tournament Poker series of YouPoker Academy, you could expect an ROI between 30% and 50% in most online tournaments and in excess of 80% in most live tournaments. Simply executing the strategies that we discuss and thinking in the way that we teach you will help you excel past most live tournament players.
Managing rebuys and addons
The rule of thumb in R&A tournaments is to always take the rebuy and addon. If you had an edge going into the tournament, you also have an edge with your rebuy. The exception to this rule is when the addon devalues your chips. For example, at a local casino there are tournaments every night. The first tournament, a $40+4, gives you 10,000 chips to start and offers rebuys for $20 per 5,000 chips. That's a fair price for an addon - each chip costs exactly $0.004. The second tournament, a deep stacked game, has a buy-in of $60+6, and gives you 20,000 chips to start. Unfortunately, the rebuy here is still $20 per 5,000 chips. This means your rebuy chips costs $0.004 per chip but your initial chip stack costs $0.003 per chip. That's a significant difference in equity -- you lose 33% of the value of the rebuy! I always take rebuys in the first tournament, but in the second tournament, I let the other players take their rebuys and I play it like a standard tournament. I win it less often, but I earn equity every time they rebuy.
Of course, if the addon gives you chips at a discount, you are making a significant error not to take these chips, no matter what your stack size is.
As far as your bankroll goes, the general rule is to pretend like the cost of an R&A tournament is five times its buyin. This assumes you'll make a rebuy immediately as the game begins, lose your stack once, and take an addon. This means you typically need 500 times the buyin for a R&A tournament in order to play profitably.
Playing in guaranteed tournaments
Guaranteed tournaments offer a unique value. If the guarantee isn't met, you're making some cash from the poker room hosting the game. If it is met, it means there are likely lots of weak players who are playing for a big prize pool. I always play guaranteed tournaments if they're within my bankroll. They're some of the most profitable games out there. Be sure to calculate the value of the "money added" or overlay before buying in -- a 1,000 player tournament with $100 "added" means each player is earning just $0.10 in overlay value... negligible value.
Blind structures can sometimes make tournaments unprofitable. Tournaments with faster blinds (or blinds that jump significantly between rounds) will typically offer professional poker players lower ROIs. On the other hand, the tournaments end faster, so they can increase your hourly profit. A lot of players will try to have a certain amount of chips at each blind structure. This is bad poker. The only thing that matters are the chips in front of you. If your stack is getting short, you'll play faster and more aggressively than if your stack is large relative to the blinds, but with a single double-up, you might have enough chips to sit back and coast into the money. The key to adjusting to your tournament's blind structure is to figure out how many hands (on average) you'll see at each blind level. In an extreme scenario, say you've got 12 big blinds and the blinds are set to double in two minutes. In a casino, you can expect to see four or six hands before you're down to 6BB. If you're currently on the button and expect to be hit by the blinds the next time they come around, it's high time to shove all in and pick up the pot or double-up in the next couple of hands. The alternative, having just 5BB, puts you in the Red Zone -- you're too short to go all in and push players out.
Fixed-payout tournaments (satellites)
There's a specific type of tournament structure worth talking about: satellites. In a satellite game, a certain number of players will all walk away with the same prize (which might be an entry to a larger tournament or a fixed $ amount. Typically, tournaments that pay out in seats are called "satellites," and tournaments that pay out in dollars are called "double throughs" or "double or nothings.")
In these games, the independent chip model is crucial. There's absolutely no value in taking first. You'll win the same amount for being the chip leader when the bubble bursts as you would for taking third. Bubble strategy in these games is much more important. If you become a very good bubble player, you can make a killing in these games, because a lot of weak players play them with no idea of proper bubble strategy.
Harrington's Zone Concept
The Zone Theory presented by Harrington in his classic book "Harrington On Hold'em" identified inflection points where your play in a tournament needs to change gears.
Dealing with limpers
Whenever a player limps in front of you, it destroys your chances of going all in to pick up the blinds with weaker-than-average hands. If you've got a strong hand, you can still go all in, but with a weak hand, you have to bluff out more players and that really hurts your chances.
The 3-Bet Jam Range
Typically, your prime 3-bet value is when you have 4-5 times raiser's raise value. If a player on the button raises to 300 and you've got about 1200, you're in a good position to reraise. It's too big for your opponent to call with weak hands but you're not risking too much to pick up the blinds and the raise. You typically want to start looking for three-bet jams when you're between 6 and 14 big blinds, as this will closely align with the 4-5x range.
So you want to be a proficient tournament poker player? One of the most important things to learn is how poker tournaments are different from cash games. The game of poker is the same no matter where you're playing it, but the fixed payout structure of tournaments change the mathematics behind correct decisions.
cEV and $EV in Tournaments
The first concept we have to address in a lecture about poker tournament math is that of Expected Value. In cash game poker, your EV is the amount of money that you make or lose on any action. For example if you make a really awful call, you could lose $50 in EV, whether you end up winning or losing the hand (If you don't follow me so far, go back to our Strategy lecture on Expected Value). In tournament poker, however, you're working with two kinds of EV: Chip EV (cEV) and Dollar EV ($EV). cEV represents the amount of chips you stand to make or lose on a particular action, while $EV represents the amount of money you stand to make or lose on a particular action.
The important thing to note is that these are different. Why is this important? In cash games, these two things are identical. At any point, you can stand up with your entire chip stack and turn it into dollars. Therefore, if you win $1 in chips, you also win $1 in dollars. In tournaments, you don't have the luxury of cashing in your chips. Having more chips makes it more likely that you are going to win money in the tournament, but these two variables are not aligned in a 1-to-1 ratio like they are in a cash game. Instead they begin to diverge from the first hand.
When you first sit down at a poker table, you have exactly the same number of chips as anyone else at the table and, therefore, exactly the same chance of anyone of winning money in the tournament (skill aside). This means that your cEV is equal to your $EV. After you play your first hand, if you win 100 chips (a very small amount), you have gained a cEV of +100 and slightly increased your $EV. The two values have not yet diverged significantly.
The bubble is defined as the last position in the tournament that doesn't pay out. As tournament play progresses closer to the bubble, though, significant changes happen. Imagine that there are seven players remaining and the top six places pay out, and you are dealt a hand like JJ. A player (who has you covered) goes all in. If you call, you are probably about 65% to double your chips and make at least the minimum payout, but you are also 35% to go home with 0 chips and $0. So your cEV is positive: in a cash game, if you were 65% to win, you'd want to take this gamble. But in a tournament, it's not quite so simple. Doubling up will NOT actually double the amount of DOLLARS that you have, only the amount of CHIPS. While your DOLLAR gain will be equal to the 6th place prize and then a portion of the remaining prize pool, this has much less value than the same double-up in a cash game.
It's a complicated concept, but in theory, the thing to remember is this: every chip you gain is worth slightly less than the last chip you gained. Going from 1,000 chips to 1,300 chips on the first hand of a tournament is a solid win. Going from 100,000 chips to 100,300 chips late in the tournament is less valuable in terms of dollars taken home at the end of the night. In practice, this means you should be hesitant to flip coins for very small cEV gains when close to the button, as what appears to be a profitable bet is actually (in $EV) a losing play. Winning tournament poker players only care about the $ they take home at the end of the night, not the quantity of the chips they have.
The cardinal rule of bubble play is: "get in the money first, then get to 1st." You should be doing whatever it takes to beat the bubble, whether that's playing fewer hands, stalling your table (within reason) in order to let the blinds go up just as they pass you, or folding when a player puts you to a hard decision. At this point in a tournament, bubble dynamics trump any existing poker strategy you may have.
Due to the non-linear value of tournament chips, the chips that you risk will be of a lesser value than those you stand to gain.
Independent Chip Model (ICM)
The concept that "every chip you gain is worth less than the last chip you gained" is called the Independent Chip Model. It is a mathematical way to convert the number of chips you have into your tournament "equity" -- roughly, the amount of dollars your stack is "worth."
ICM is relatively self-explanatory if you understand the differences between cEV and $EV, and we really only use ICM at the end of a tournament when players are talking about splitting the final results.
After the bubble bursts
Play for first. After the bubble bursts, all considerations surrounding the bubble become much less important. Now, the cEV and $EV disparity, which has increased throughout the tournament to this point, have disappeared. Now, your chip EV and your $ EV are identical again. The 1st place position will take home the most money, and the only way to get 1st in a tournament is to gather every chip on the table, so begin playing according to cEV (cash game) strategies once again.
Tournaments are about stack preservation
One of the most important concepts in tournament poker is stack preservation. When your stack begins to dwindle, all of the hands you get in the future are actually worth less. If we were to get a hand like pocket aces and double up with them, we'd rather have our 5,000 chip starting stack than have called several bets and let our stack fall to 3,500. In the first case, we'd have 10,000 chips. In the second, just 7,000. That amounts to a significant chip difference, as tournaments require us to double up five or ten times in order to win the game. It's important in an MTT to have a stack that's as big as the other stacks at the table, and stack preservation goes a long way to ensuring this is the case.
What does stack preservation mean? Simply, don't risk chips that won't earn you a return, and prefer a high-frequency return over a high-value return. For example, if you have the nuts on the river, and you have the option to make a small bet that will be called more often or a large bet that will be called less often, it's often more valuable to make the small bet. It also means not calling before the flop, but raising or folding instead. Calling before the flop, especially shorter than 100BB deep, leaks chips. At the early levels of small stakes tournaments, you often see players calling before the flop. Don't fall into the trap of saying "everyone else has called, so I have odds to call." In higher stakes tournaments, or at the final table of medium-stakes tournaments, you see very little calling before the flop. Players who make this mistake go broke.
Master the pre-flop and flop game
In poker tournaments, the hand often ends before the flop. If it doesn't end before the flop, it often ends after the flop. Very rarely do tournament hands go to the river. For this reason, we recommend mastering the early streets of poker play. Understanding continuation bets, understanding play between 15 and 30BB, and knowing when to steal blinds will go a long way to improving your winrate at poker tournaments.
I'm sitting in the bar at the Casinó di Venezia with Sandor Demjan, the richest man in Hungary, worth over $4 billion. When we met before, in Krakow, Poland, we played together for nearly twelve hours before the morning light broke up the game and sent us our separate ways.
Sandor has just busted out of the WPT Venice. His hand, , didn't hold up after a pre-flop reraise puts him all-in against .
I can always hear the sea calling anytime I'm in Venice: it sings the soft, gentle song of the whale. I invite Sandor to a game I have scheduled for tomorrow night. I am certain he will attend.
This article will detail what changes you should make to your standard heads-up game if you are heads up at the end of a major tournament. We'll discuss what you should look for in your opponent and how you should go about handling chops, even if you feel you have more experience than your opponent.
The first and biggest change to a typical heads-up game is the antes. Because of the antes, you're going to raise every single two-card hand on the button, for the rest of the tournament. Typically a balanced heads up preflop strategy will mix in limps and folds to create an optimal strategy, but in a tournament situation, both players should be raising every hand preflop. Failure to do so is an immediate loss. Create your optimal strategy after the raise: figure out the appropriate calling range for a three-bet and the appropriate four-bet range depending on how often your opponent is attacking your raises.
The second change worth mentioning is the fact that your opponent probably didn't enter the tournament expecting to play heads-up poker. In a lot of cases, it might be his first time playing heads-up, and so we're going to need to be able to quickly classify the player and adapt our strategy. The first thing to remember is that, unless your opponent has significant heads-up experience, he's going to be flying a bit blind at this point in the match. Most people are going to adopt a trial-and-error strategy... he'll play the same way until a lot of chips change hands or the effective stacks get much shorter.
Playing against opponents from different backgrounds
Depending on your opponents poker background, I've found a few things are true about his playing style in the heads-up phase of an MTT. If your opponent is an MTT grinder, but hasn't got that much heads-up experience, he's going to raise around fifty percent of his buttons, limp another 25%, and fold the worst 25% of his hands. If he's a good MTTer, he'll likely 3-bet relentlessly, usually when your stack is about 8-12x the size of your raise. If he's 3-betting you deeper or shorter, he usually has a strong hand.
If your opponent comes from a 6-max cash background, expect to play a post-flop game, and try to avoid this. Don't raise as often from out of position, and when you do raise, vary your play on flops. In position, check back mid/bottom pair, and check back air sometimes too. Most of these guys are itching to check-raise, so see that coming.
If you're playing against a fish (a dream come true!), keep the pots small and don't gamble with him. Minraise your buttons still, but don't call his 3-bets or button raises without a VERY good hand. If your hand is marginal, or you can't decide between two decisions, take the less risky approach.
Should you chop?
The last point I want to make is about chop considerations. Let's assume you've got a 5-10% ROI edge on your opponent, which wouldn't be unheard of, even though you're only 20-40 BB deep. If the 2nd place money is more than 10% of your bankroll, you should CHOP even-steven without any questions. Try to get a few % out of him, especially if he's wise enough to SharkScope you and see your heads-up experience. But, even if the best chop he'll offer you is an exact chop by chip count, you're doing yourself a favor, in the long run, by having the money you've already earned without risking it. I know chopping for 2nd doesn't have the same glamor as taking down a major tournament, but you'll have the opportunity to move back to to your regular with a padded bankroll and peace of mind that you made a good decision. If the difference between second place and first place is $5,000, you'd need a bankroll of at least $50,000 to enter a heads up SNG of an equivalent value. Even if you expect that you have a 10% edge in the game, you would be making a mistake by entering it.