Wednesday, March 31, 2010

Poker Rules

Recently I was asked the question "In the Red, White, and Blue Poker League tournaments, do you use the same rules as the World Series of Poker?"

The actual situation was that I was chipping up players, I needed to move someone to balance tables, I had a handful of chip racks and I was walking by when someone stopped me and asked a question about how to apply a particular poker rule in the current hand. I don't recall the actual question, but this got several people all asking me questions at once and culminated in a non player who was standing near the table asking first if the poker rules are on the website, and secondly if we use the WSOP rules.

The situation was hectic, confusing, and it was clear to me that he was not going to get the answer he wanted, so I suggested we have the conversation another time. I could not understand what he was looking for and hoped to resolve it later.  It didn't happen that way.  :)

But, the concept of poker rules is of interest to many players.  I'd be happy to provide an answer, but I am just not sure of the question.

The answer to the question - Do we use WSOP rules is difficult to answer because it is a badly worded question.  Do we?  Of course not.  No bar poker game does.  The WSOP rules rely upon dealers and multiple floor personnel.  So do we use the WSOP rules?  Yes, of course we do.  Most bar poker games, the well run ones anyway, use the WSOP rules.

Everyone knows there are very clear rules of poker, and all rules are the same.  Everyone knows that every organization that runs poker tournaments has rules that vary slightly from the next place.  So all rules are different.

So do we use the WSOP rules?  An answer is that when a rule has a variance between the WSOP version of the rule and the WPT version of the rule, we tend to use the WSOP implementation of the rule.  I actually don't know of any variances, but if someone were to bring it to my attention in a contested situation I would lean towards the WSOP version rather than the WPT version.

What I am trying to say is that the actual question, do we use the WSOP rules has little validity unless it is put into context. We use generally accepted poker rules, such as are found in casinos.

Casino poker rules were originally standardized by Bob Ciaffone who setup several major card rooms.  Bob Ciaffone wrote a 38 page document is entitled Robert's Rules of Poker which borrows it's name from Robert's Rules of Order (used as the parliamentary authority for deliberative procedure.)

All the casinos then have their own implementation of the rules.  Harrah's, Showboat, Caesars, and Bally's are all owned by Harrah's Entertainment, as is the WSOP.  The rules vary slightly from Harrah's/Showboat to Caesars/Bally's and then to the WSOP.  On top of all this is the Tournament Directors Association (TDA) which votes on and publishes it's own set of poker rules.

But this is not the gobblygook you were looking for.  You want something solid to go home with.

Our tournaments differ from WSOP rules in the following:
  • We do not have assigned dealers for each table.
  • We "chip-up" rather than "race-off" chips to remove them from the table.
  • We allow blinds to stand if they have been posted.  Casinos do not allow this.
  • We have no roped off area that the spectators must stand behind, we allow them to watch the table.
  • The deal is done by drawing cards at each individual table, not a single deal for high card.
  • Seats are not assigned in our tournaments.
  • Recent WSOP rules require a player to be SITTING in his seat, not standing next to it for his hand to be live. The TDA has voted against this.  Our rule is you look around, if you don't see the player, you may fold him.
  • A bet is chips in front of your cards.  In the WSOP it is chips past the betting line. In some casinos it is chips in front of your cards.
  • We take a constrictive view on the two page WSOP F-bomb rule, but adopt a lenient implementation of the penalties.  The WSOP is more constrictive on their televised tables and less constrictive in general play.  The WSOP uses a penalty of time, the TDA uses a penalty of rounds.  We penalize in rounds.
I'm sure there are a hundred or so other variances, but I'm not going to list them all here.
So an answer is yes, as long as you accept the hundred or so ways our rules are not the same as the WSOP, we play by exactly the same rules as the WSOP.

Sunday, March 28, 2010

Playing Pocket Threes

In a recent bar poker game, I decided to sit down and play to win.  The chips started coming my way, and then I got dealt pocket threes, also known as crabs.

A low pair is the sort of thing people debate on whether or not to play.  Pocket threes as it turns out, are a Sklansky Group 7 starting hand.  This means they are playable in late position with no previous raiser.  The book says to fold small pocket pairs when in early or middle position.

The actual odds of winning with a wired pair of threes preflop is about 13% at an eight person table, or about 1 to 6.4.  Once you narrow it down to five people in the hand, the odds improve to about 1 to 4.25.  With 400 in the pot, my call of 100 is pot odds of 4 to 1.  This is not exactly stellar expected value (EV), but I called anyway.

The trick is that if you flop a set, no one sees you coming.  When you do flop a set, the implied pot odds are enormous.  With a flop of say, AK3, the players with high face cards will fall over themselves to bet their pair or two pair while I'm holding back a grin and looking at my set of threes. While the guy betting Big Slick thinks he has hit paydirt, I've trapped him and will be taking all his chips.

The odds of flopping a set are about 7:1.  That means that once out of every eight flops with a pocket pair, I get trips.  The flop came and was 773.  As it turn out, I flopped a boat.

So the betting goes on and on.  Before long everyone is all in. There is not much chance of me losing the hand.  When we have our showdown I proudly turn over my boat.  The flush loses to me.  The other guy had a pocket pair as well - pocket sevens.  He flopped quads.

Phil Hellmuth is credited with saying 
I guess if there weren't luck involved, I'd win every time.

Friday, March 26, 2010

Poker and the Nash Equilibrium

A natural strategy in poker as in any other situation is to play to win.  But is this always the best strategy?

How to play against an All-In
When a player goes all in in a poker tournament, there are two basic strategies that the other players use. Well, the other players who choose not to fold.  There is the
  • let's check it down strategy, and 
  • the isolate strategy.
Check It Down
Some people say there is a gentleman's agreement in poker where they check it down.  First of all, let's get it straight.  When you play poker, there is nothing gentlemanly about taking one guy's car payment so you can pay your mortgage.  There is no rule that exists to say you don't bet when someone else goes all-in.

Another common thing seen at the poker table is a later player making a big bet, or a raise to isolate the other players out of the hand to transform the play into heads up.  Some believe this improves the raiser's chances as with less players they are more likely to win the pot.  This shows an insight into the math of poker.  Others call this same act protection.  These people either have heard someone else call it this, or the have an even better understanding of the math at play here.

The Natural Strategy
A natural strategy is that greed is good. The poker player pursues his own self interest, the pursuit of chips.  This theory is espoused by economist Adam Smith in The Wealth of Nations (1776), saying "by pursuing his own interest, [the individual] frequently promotes that of the society more effectually than when he intends to promote it."  This is the good old American Dream.  Win the chips and the world is a better place.

The Nash Equilibrium
John Forbes Nash is a Mathematician who won the 1994 Pulitzer Prize in Economics for a bargaining strategy known as the Nash Equilibrium.  His life was fictionalized in the movie A Beautiful Mind.  Nash noted that if everyone is out for themselves then sometimes everyone is playing a sub par strategy.  A Nash Equilibrium exists when each player plays his best response to the situation. In Nash's theory, each player has some understanding of what the other player might do.

Nash's theories turned traditional economics upside down, but have been very useful in a variety of game theory applications. Nash's theories suggest what if by pursuing your own self interest you may get less, but by pursuing the greater good you get more.  In practice we see this in trade cartels and shared standards (VHS vs. Betamax)

Applying this to the all-in move in poker involves stepping back for a moment.  What is your goal?  Is your goal, in a tournament, to acquire chips, or is your goal in a tournament to eliminate players?  Utilizing Nash's theory a player can postulate that he wins in the long run if he gives up chips in this all-in hand.

The Downside to Isolation
Suppose the player who goes all-in preflop has pocket Aces.  If nine players at a ten person table call him, he then has a 31% chance of winning against the nine random hands.  If the isolation succeeds and transforms this into heads up, the the all-in jumps to an 86.4% chance of winning with his pocket Aces.  The raiser has indeed improved his chances of winning, but at the same time he has improved the all-in's chance of winning.

By isolating, the raiser purses the American Dream by attempting to win more chips.  The downside is that the all-in was 2:1 favorite to lose the hand, but now is a 6:1 favorite to win.

The Equilibrium
The optimal strategy that cannot be improved upon is for all players to not bet after the all-in.  To, in practice, check it down.  By giving up the direct pursuit of chips then all players benefit against the all-in by providing the best chance of eliminating him from the game.

Variations on a Theme
Mathematically, the only situation where it makes sense to bet is when you have (flop) the nuts.  If you have the true nuts, then you do not have to be concerned about the all-in NOT being eliminated.

Collusion Warning
If everyone just happens to adopt a strategy of checking it down then that is fine and that is legal.  But as soon as someone asks the group about checking it down, then collusion is occurring and the rules of poker have been broken.

In conclusion, follow the math.  Don't bet against an all-in.

Thursday, March 18, 2010

Winning by Losing in Poker

I haven't played poker much the last month, except for a few online tournaments.  However, I sat down and played a bar poker tournament a few days ago.  There was a particular hand that I want to share - it involved pot odds.  I may not have the details correct in my memory, but the pot odds principle is there.

To be honest, I wasn't really playing at first.  I was running a tournament that started small and an extra player was needed at the table.  So I sat down and played.  Without any real desire to win, I just bleed chips to the other players until almost all of mine were gone.

Then I realized, why not?  I should go on and win this thing.  So, I started playing in earnest.

A pivotal moment came where I was the big blind for 4,000 chips.  A guy in middle position raised to 8,000.  There were three players who called.  It was on me. My cards really weren't that good.  I didn't even need to be in the hand.

The pot was now 36,000; I had to call 4,000.  That gave me 9:1 pot odds.  With those pot odds, I really wanted to call, so I pushed in my extra 4,000 in chips.  The flop came.

I almost laughed.  The pot was 40,000.  I had just flopped an open ended straight  My odds of catching one of my four outs was 31.5%, or about 1:2.  Trying to keep a straight face and failing, I blurted out to the original raiser "There is nothing you can bet that will not give me good pot odds."

After the flop, you want to make a big bet that destroys a person's pot odds and keeps him out of the hand when he has a draw.  On a 40,000 pot I'd call 100 (an impossible bet here) even if I had nothing at all and no chance for a draw.  40:1 pot odds would be too much enticement.  But even if he had 40K in chips, I'd have to call - that would give me 2:1 pot odds, a break even point.  If someone else called, my pot odds woudl be even higher.

So the original raiser opened for 10K.  That gave me 4:1 pot odds, and since two more players went in, it gave me a 70K pot I needed 10K to call.  With 7:1 pot odds, and 1:2 odds of making my hand the "pot odds" were dictating that I call.

Work it out.  Over time I will lose two out of every three hands like this I play.  So I am far more likely to lose than to win.  But by playing a hand that loses, my chip stack will grow.  If I play the hand 100 times, at a cost of 10,000 to call on the flop, it will cost me 10K * 100 = 1,000K chips.  If I win 1/3 of the time, I win one third of 80K * 100, or about 8,000K / 3 = 2,666K chips (the actual amount is 8,000K * 31.5% = 2,520K chips)

For 100 such hands, my win of 2,520 chips, less my cost of 1,000K chips equals a profit of 1,520K chips, or 15K chips per hand.  To put in terms of mathematical expectation, I "expect" to win 15K in chips every hand, whether I win the pot or not.  How can I not call?

This is what pot odds are and how they are played.

Just to note, since this would have bankrupted me if I had lost, which I was favored to do in a one hand situation, stack management is important to consider as well as pot odds.  Always call when in a cash game, but for tournaments it is a gamble.  But I gambled, and won.

Just remember, it is important to know the math.

Thursday, March 04, 2010

Cheating for Free

Free bar poker is an excellent place to practice your card skills.  If you lose there is no penalty - it costs you nothing to play.  It should be no surprise that people come into the poker league and try cheating.  The same thought must prevail in the mind of the cheating player - what is the worst that can happen for cheating in free poker?

Presumably you kick the person out of the league and bar them from playing with the honest players.  I catch people cheating a lot.  More than you would think.  My ability to catch them cheating has far less to do with any brilliance on my part, and relies more on their ineptitude at being dishonest.

Recently I caught someone cheating in a big way.  As a courtesy to the bar, I informed the manager about it before I went to kick the guy out.  The manager did not want her valued customer, the cheater, removed from the poker tables.  I can't imagine why; I do know they have spent time outside the bar playing for real money at his home game. Free bar poker can pay off - he gets to make use of the skills he practices at the bar poker games.

About two weeks ago I decided enough was enough.  So I told him while I could not kick him out of this one bar, he was banned from all our other poker games.  He was a very unhappy camper that night.  How does that one particular bar feel about it?  Well, they don't really talk to me anymore, so I am not sure.

He did win first place with new league running the show.  I suspect both the player and the bar manager are both happy now.  I wish them well.

Tuesday, March 02, 2010

Felony Poker

I recently had a disagreement with the manager of a local restaurant where we played free poker.  The manager wanted to refuse to allow the tournament winner to participate in winning the prize money unless the winner had made a purchase of at least $10.  I pointed out this would be illegal, but the manager was undeterred by my concerns.

What follows is the written result of my research into the matter that I made available to the restaurant.  What was the reaction I got?  Let's just say they were not pleased that I would not go along with them.  Enjoy...

 - * - * - * - * - *

I've tried to provide a short summary of how your proposed policy interacts with existing gambling law in Virginia.  Included are a number of relevant quotations from an official Attorney General "opinion."

Gambling is generally illegal, in particular unlicensed gambling.  But what is gambling?  It is generally agreed that a three-prong test must be applied to define something as gambling.  These three prongs are 1) Consideration, 2) Chance, and 3) Reward.  If any of the three prongs are missing, then there is no gambling.  If all three are present, then gambling is occurring.  Bar poker is only legal because it lacks the "consideration" prong.

This is codified in Virginia law 18.2-325.  Consideration is referred to as "placing a bet of money or other thing of value."  Chance is mentioned as "[an] event the outcome [of which] is uncertain or a matter of chance."  Reward is mentioned as "a prize … or thing of value."

Consideration is what you pay to play.  This is generally money for a buy-in, or money to purchase a ticket, or the "bet" that is made.  In North Carolina the state has construed that entry into a restaurant to play poker is "consideration."  In some such states, non pecuniary consideration is accepted, such as walking in the door.

In Virginia this concept is clarified by 18.2-333. 
no consideration shall be deemed to have passed or been given because of any person's attendance upon the premises of another … where no charge is made to, paid by, or any purchase required of him in connection therewith.

So by law, the act of walking in the door is not consideration in Virginia, unless a purchase is required. 

A March 2006 Attorney General opinion on bar poker states:
In our opinion, the type of poker tournaments that you describe does not involve illegal gambling so long as the participants do not pay any money or other valuable consideration, directly or indirectly, in order to participate in the tournaments at any level.

Relevant excepts from the Attorney General opinion include
There is no requirement that a player make a purchase at the tavern – e.g., purchase a drink – in order to play

If there is no consideration, then these poker tournaments would not
be illegal gambling prohibited by the State’s criminal law. An
essential element of gambling is absent when “there is no money or
other thing of value given or required to be given for the opportunity
to receive an award determined by chance. Mid-Atlantic Coca Cola Bottling Co. v. Chen, Walsh & Tecler.

Consideration may simply be money paid to participate in the game. However, consideration may also take many other forms. See, e.g., Opinion of the Texas Attorney General GA-0385, 2005 WL 3568394 (2005) ($10 donation to charitable cause to enter “poker run” was consideration, even if it was not commingled with prize money); Opinion of the Texas Attorney General GA -0335, 2005 WL 1464850 (2005) (“nominal fee” paid to enter Texas Hold ‘Em tournament was consideration even if house did not share proceeds); Opinion of the Kansas Attorney General No. 05-04, 2005 WL 218294 (2005) (payment of cover charge to enter bar where poker tournament was held constituted consideration); Opinion of the Arkansas Attorney General No. 2004-357, 2005 WL 591228 (2004) (entrance fees for poker tournament or membership fees for poker league would supply element of consideration); Opinion of the Tennessee Attorney General No. 05-159, 2005 WL 2755423 (2005) (admission fee to Texas Hold ‘Em tournament was consideration).

In conclusion on the topic of Consideration, the Attorney General says:
Thus, if participants in the tournament you describe were required to pay a cover charge or to purchase a beverage as a prerequisite to participation in the poker tournament, the element of consideration would be present.

Based on my understanding of your proposed policy, requiring $10 in purchase to win the prize would be considered according to Virginia Law 18.2-238 to be illegal.  The restaurant and operator of the game would be guilty of a Class 6 felony.  And under 18.2-326 any player who makes a purchase in the game would be guilty of  Class 3 misdemeanor.

As you requested, this hopefully will help explain to you why I do not wish to be a part of such illegal activities.