Small Stakes No-Limit Hold'em

I’ve been thinking that Seo’s situation might even be worse than the authors said.  If Seo has been playing for many years and has maintained a win rate of $12/100 hands for all that time, then the analysis is OK as it stands in the book.   However…

What if this is Seo’s first year as a poker pro?  Then I think we have a different story.  His win rate might not really be $12/100.  He might just be running good.

Example: his win rate might really be $9/100.  Then Seo should have only made $90K last year.  But his 99% confidence interval is now $40K to $140K.  So the $120K that he actually made is well within that interval.

So now if Seo runs bad this year, he might only make $50K or even $40K! 

It looks like Seo better not let his current $10K/month win rate go to his head.  He better not be spending anywhere near $10K/month.  He needs to live as frugally as he can, and sock as much of that money as he can straight back into his bankroll. 

Maybe after his bankroll grows to something like $200K or so, then he can relax a little and spend a slightly higher percentage of his earnings.   But until then, growing his bankroll has to be his top priority.

And as always, we all need to remember the reality that we are not Seo Awsum…