Bankroll Management

Article by Richard Cunningham

I have now been at Ladbrokes Poker for nearly 5 years. I started as a Poker Customer Service agent and now find myself enjoying the challenge of heading up the Poker Operations team in Gibraltar. Over the years I have noticed that we are consistently called by customers who have had a run of bad luck and cannot understand why their well earned poker funds are depleted long before they should be. Most Poker players I know are convinced they are the best. (I am by the way, so you can all forget it!)

So when the cards do not fall in our favour we tend to blame everything apart from ourselves. Losing while holding the best starting hand is part and parcel of the game. If this never happened poker would not exist, we'd deal two cards and the best two would win. Where's the fun in that? The majority of players are recreational and play because they enjoy this wicked and twisted game. However as I well know only too well, it's so frustrating when your Aces are busted in a big pot and suddenly your balance is down to 0 meaning no more play until you can either win a freeroll or have the funds available to reload your balance (I limit myself to a monthly deposit limit - something that you can set on your Ladbrokes account via the cashier).

The following principle is key to becoming a (relatively) successful poker player (along with a certain amount of skill and luck). Without the proper money management skills, the best players in the world would go broke. The basic rules of bankroll management for Texas Hold'em are:

• 20 buyins for NL Hold'em
• 300 big blinds for Limit Hold'em
• 40 buyins for SnG Tournaments

What is bankroll management?

Bankroll management (sometimes abbreviated to BRM) is where you play at certain limits to avoid losing all of your poker money due to bad runs of cards, which any poker player must expect from time to time. This is called "playing within your bankroll". Subsequently, if you play at higher limits where there is too great a chance of losing all of your poker money, you are "playing out of your bankroll".

Why is bankroll management important?

Every player, irrespective of ability, will experience variance in their game. Bankroll management is in place to deal with this variance and allow you to continue playing without going broke and having to dip into your pocket to reload your account.The reason why you should choose your limits carefully in poker is due to the variance. Variance is a term used to describe the "ups and downs" of poker where you swing from having bad runs of cards to good runs of cards, resulting in shifting profits and losses. If you play poker for long enough there are going to be periods of time where you will frequently lose money, not because you are playing badly, but because the cards are not falling your way. This means that if you do not have enough money in your bankroll to absorb these big downswings, it is likely that you will lose it all.

Therefore every time we sit down at the poker table, whether it be live or online, we want to give ourselves the best opportunity to win a maximum amount of profit whilst keeping the risk of going broke minimal. This is where the rules of bankroll management come into play.

So what limits should I be playing at?

Cash Games

If you are playing pot limit or no limit poker, the safe recommended size of your bankroll is 20 times the full buy-in of where you want to play. This means that if you want to have the best chance of making money at a €1/€2 game where the maximum buy-in is €200, you should have a bankroll of at least €4000. This figure may come as a bit of a shock to some, but the principle applies. There is nothing stopping you from playing at higher levels than bankroll management rules dictate, but you must be prepared to either leave the table empty handed, or leave with a spring in your step and a few extra Euro’s in your poker balance!

With €50 bankroll you should be playing at 1c/ 2c tables. However, if you are not familiar with the rules of bankroll management, this is going to sound far too cautious and much too low stakes with €50. Despite this, the basic rules of bankroll management suggest that you should have at least 20 buyins for the limit you wish to play at, which places your €50 bankroll in the 1c/2c stakes with 25 buyins.

If you like to play limit Hold’em however, you should have 300 Big Bets as a minimum for the limit you wish to play at. Therefore to play €1/€2 limit Hold’em, you should have a bankroll of at least €600.

Therefore sticking to the principles of good bankroll management a €30 bankroll should see you sitting at 5c/ 10c limit Hold’em tables.

Sit and Go Tournament games

It is recommended that you have a bankroll that will give you 40 buy-ins to the level of tournaments that you wish to play at. Therefore if you want to play at the €10+€1 Sit n Go's you should have a bankroll of €440. With a €50 bankroll the €1 tournaments are the tournaments where you should be sitting at to be in with a chance of showing a profit long term.

Bankroll management table

Absorbing losses and moving on

Good bankroll management helps you deal with the psychological impact that losses can have on your game. If you have a bankroll of 10 full buy-ins for a cash game at the 1/ 2 NL game and lose 4 buy ins, your bankroll would deplete from €2000 to €1200. Thanks to your small initial bankroll this looks like a big loss and may cause you to tighten up your game and play "scared poker" because you are afraid to lose more money. Now if you had 20 full buy-ins for the 1/ 2 game, your bankroll would change from €4000 to €3200. Immediately you can see that visually this does not look as bad as the loss in the first instance.

The same applies to play at micro levels:

• If you have a bankroll of 10 full buy-ins for a cash game at the 1c/ 2c NL game and lose 4 buy ins, your bankroll would deplete from €20 to €12.
• If you had 20 full buy-ins for the 1c/ 2c game, your bankroll would change from €40 to €32. Immediately you can see that visually this does not look as bad as the loss in the first instance. Therefore you will feel more comfortable that you have the ability to win back the lost money without feeling the need to change your game.

Moving levels

There will be times when you have bad runs of cards and good runs of cards. At certain times your bankroll will be too small or too big for the limits you are playing at. If your bankroll drops below 20 full buy-ins, then you should also drop down a level so that you are playing within your bankroll until you have built it back up enough to play at the next level.

If you have more than 20 buy ins for the limit above, then it makes sense to move up to that limit if you feel you can beat it. Just be sure to drop back down to the lower limit if you experience significant losses. You could be playing out of your league. At some point in your poker journey you may want to move up a level to see how well you do. There's no harm in trying this as long as you stick to good bankroll management for most of the time you play poker.

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