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Standard deviation (variance) - how do I calculate it?

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01-03-2006, 10:47 AM Post subject: Standard deviation (variance) - how do I calculate it?

#1 (permalink)

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I read Mason Malmuth's thoughts on this and he recommends that the bankroll should be 4/9 (variance) / (winrate)

variance = (standard deviation )^2

I have PT, but how do I get that stat?

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Pelion

01-03-2006, 02:38 PM

#2 (permalink)

4-of-a-Kind

Join Date: Sep 2005

Posts: 3,206

session notes tab -> more detail near the top right

gabe: Ive dropped almost 100k in the past 35 days.

bigspenda73: But how much did you win?

01-04-2006, 10:48 AM

#3 (permalink)

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lol I think I have a tiny sample size
my standard variation is 25...
I really need to play more and get that winrate down O.o
but even assuming my true winrate is 5 BB/100 I'm getting 58BB bankroll to be 3 standard deviations outside the mean to bust

Demiparadigm

01-04-2006, 11:41 AM

#4 (permalink)

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Join Date: Feb 2005

Location: Party 6 max

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Quote:

Originally Posted by iopq

Its amazing no one read my bankroll post

http://www.flopturnriver.com/phpBB2/...ic.php?t=22364

3 standard deviations is WAY too small.

assuming 5BB/100 and 25BB/100 SD

we get:

r = exp(-2uB/sigma^2)
= exp(-2*5*58/25^2)
= 8.5% risk of ruin.

unless you're cool with that. In that case,

Good Luck.

To win in poker you only need to be one step ahead of your opponents. Two steps may be detrimental.

01-04-2006, 12:45 PM

#5 (permalink)

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that risk of ruin is out of how many hands :O
because if I have 8.5% chance of moving down a limit and 91.5% chance of moving up a limit this formula would give me a lot of high limit time (more profit)

unless I'm misunderstanding something (the chance to bust is one of the things I'm unclear on)

what about 4 standard deviations?
What should be my bankroll and what's my chance of busting?

01-04-2006, 01:07 PM

#6 (permalink)

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using the pdfs for 5% risk I'm getting 83BB
I mean I can just go down to my old level when I lose money and I can move up faster when I win

the problem is that grinding upwards is slower than dropping down so I want to spend the MAXIMUM time at the higher limits

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Standard deviation (variance) - how do I calculate it?

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