GTO Poker Theories: Asymmetric risk

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One of the real gifts poker has given me is that it has been a great jumping off point to learn things from other disciplines like economics, AI, psychology and Game Theory. So here is a series of articles where I bring some of the most interesting things I have learned from other subjects outside of poker which are applicable in this game we know and love.

As we have written before, you cannot control blind luck but you can put yourself in good or bad positions to get lucky. One of the ways in which you can improve your chances of getting more from uncertain endeavours is by taking positive asymmetric risks.

A symmetric risk is one where the upside is the same as the downside. An even money bet is as straightforward an example of this as you can get. If you bet with a friend $10 on heads or tails, the downside is you lose $10 and the upside is you win $10. An asymmetric risk is one where the upside is much greater than the downside (or vice versa).

Working for an hourly wage is close to a symmetrical risk/reward scenario, you lose an hour of your time but get an amount of money you felt warranted it. Let’s say you coach 25NL for $20 an hour, you lose an hour of playing time but you make $20. If instead you spent that hour making a training video and sold it for $20, that would be an asymmetric risk. There is more downside because you may get no customers at all, but it’s still only an hour wasted, and the upside is potentially huge. If 10 people buy that video you have made ten times what you would have coaching.

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More upside than downside

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Playing with 100% of your bankroll is a negative asymmetric risk

There are lots of decisions that involve asymmetric risks at the table, most of which are game selection and bankroll management considerations.

Playing with your entire bankroll on a cash game table is a massive negative asymmetric risk, because although you stand to lose a similar amount to what you could win, the wider impact of going broke could be massive if you don’t have funds elsewhere.

There are certain poker formats where you get bigger upsides than downsides. Tournaments, for example. If you are observing good bankroll management then your biggest winning day as a tournament grinder should always dwarf your biggest losing day (though you could still be a losing player overall). We have written about this before, but the upside of Spin & Go’s is enormous, but the downside is somewhat capped. The nearest format to Spins are probably HUSNGs, which are comparatively a very symmetric risk format.

Pick the games with the biggest upside

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The upside of a satellite is huge

Please forgive me constantly bringing up satellites but they are fresh on my mind. Playing satellites are a positive asymmetric risk if you are budgeting appropriately for them.

If you play a $15 satellite into the Sunday Million, the downside is you lose $15 and the upside could be winning six-figures, however unlikely. There are times in the satellite itself where calling an all-in when you have a seat locked up is a negative asymmetric risk. All the prizes are of equal value, so when you call and win all you win are chips, but when you call and lose you miss the money completely.

None of this is to say formats like cash are a mistake because you can’t take down big jackpots on a single day. Playing in good games where you have a big edge, whatever the format, is a positive asymmetric risk compared to playing in tough grinder games.

Ultimately the biggest positive asymmetric risk you can take is learning. An hour spent reading or being coached is at worst an hour wasted, but if you can take something away from that hour that you can use the rest of your life, the upside knows no bounds.

What theories from outside of poker have helped your game? Let us know in the comments.

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Barry Carter

Barry Carter

Barry Carter is the editor of PokerStrategy.com and the co-author of The Mental Game of Poker 1 & 2.

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