I have been playing poker online for a few years now and until this week I have been to lazy to properly mange and synchronize my hand history files. I do all my opponent analysis and hand history analysis under Windows. The analysis software I use is Hold’em Manger, Poker Hands, Poker Stove, Sit and Go Wiz and Troutulater. The problem I have been faced with is that I play across three different computers and two different operating systems.

DropBox: Synchronize, Backup and Import

DropBox is an easy and seamless way to synchronize and backup documents across computer’s and the internet. If you have not got an account yet sign up now it is FREE. After you have signed up to DropBox download the desktop application and install it on all desired computers. As I primariliy play on my iMac my laptop or my Windows7 machine; I created a root folder in my DropBox called HandHistory and three sub folders for each computer.

You will only need to define the structure once and it will be synchronized and backed up online.

Change your HandHistory Folder

In all of your poker clients you will need to save the HandHistory data to the desired drop box folder. This will automatically store the data online and synchronize it across computers. In my case I launch my stars client and choose the corresponding DropBox folder.

Final Step

Now that you have configured all your poker clients to save HandHistory’s to your DropBox it is time to configure your analysis software. Just put in the path to your DropBox –> HandHistory folder and now all that is left to do is click import. I have found this to be an excellent solution and is much better then using USB stick or other methods.

Value bet: You believe they hold the best hand.

Semi bluff: You are drawing to what the believe will be the best hand and your opponent may possibly fold their hand.

Pure bluff: Your hand has no value and they have no draw. The only way to win is to get your opponent to fold.

This past week has reminded me of the fact that even if you do everything right and put money in with best hand or best draw you do not deserve to win all the time. If you put money in the pot when you are a 70/30 favorite you will still lose 30% of the time.

I think it is pointless for me to write about bad beats and cooler hands I have experienced. This week I have been disappointed how I have reacted to bad beats. On four occasions I have let my emotions get the better of me and mouthed off in the chat box.

Five Reasons Why Berating Opponents is Bad

1. It Helps Your Opponents Improve their Game
2. Your opponent may be offended and leave.
3. Other players will notice you tilting and may exploit you
4. It is poor sportsmanship.
5. It is immature.

I have been happy with my game over the pat week. I need to control how I handle bad beats and adjust to weaker opponents. So if you see me at the tables and I am talking trash remind me that at the poker table no one is entitled to anything.

Fixed Limit 2-7 Triple Draw Lowball

This week I played 32 short sessions 20 of these 32 sessions were losing sessions. In total I played 1795 hands mostly at 25c/50c and  50c/$1.  I am very happy with my game at the moment and am sorting out most of my leaks. I still need to work on some areas of my tournament strategy. I finsished the week :

-$10.86

Fixed Limit 5 Card Draw

FL5CD was my favorite game back in the day and I built my first bankroll playing this game. I only played the low stakes up to $3/$6 the games used to be good and the money was easy. These days the Kiev Card Sharks own the tables and the games are only good for 1 BB/100.   This week I decided to revisit these games and when TD games aren’t running I will play 5CD. This week I only played six sessions I played 398 hands at 25c/50c five winning sessions one losing session to finish the week:

+$23.39

Tournaments

This week I played 26 tournaments in the following games

• Triple Stud 3 games one cash 1st for  $35.75. Profit/Loss: +$31.35.
• 2-7 Triple Draw 13 games played 8 cashes  $109.30. Profit/Loss: +$98.30.
• Badugi, PL5CD NL Hold’em and 8-Game. 7 games played 4 cashes. +$0.70.

+$130.35

Sit and Go’s

My main Sit and Go’s I play are the $2.20 No Limit Hold’em 180 man turbos. These games have quite a high variance. I have only played a few of these and a PL 5CD Sit and Go this week. Played 6 cashed in two and cashed in PL5CD.

+$70.64

Reflections

This week I will be focusing on my tournament play and strategy. I will watch some DC videos and read some more 2+2. I am nearly finished the book treat your poker like a business. I will post a review  on my thoughts on the book shortly.At the end of the week I finished +$213.52. Hopefully the run good continues and I can move up the stakes.

Month One Stats

Triple Draw Tournament Results

• $2.20 – Runners:33 Finish Pos:21 $Won/Lost:-$2.2
• $2.20 – Runners:17 Finish Pos:6 $Won/Lost:-$2.2
• $2.20 – Runners:38 Finish Pos:18 $Won/Lost:-$2.2
• $2.20 – Runners: 33 Finish Pos:21 $Won/Lost:-$2.2
• $2.20 – Runners:31 Finish Pos:1 $Won/Lost: $24.80

Overall for TD tournies finished up $16

Played some other random tournies with $T, these are not included in the Triple Draw Challenge.

Cash Game Results

Anyone who has seen me at the tables in the last week would have seen how unfocused I have been. Time to get back on track this month.

• Hands Played: 4217
• Sessions Played: 66
• Losing Sessions: 32
• Winning Sessions: 34
• Avg Losing Session Amount Lost: -$2.48
• Avg Losing Session Amount Won: $3.13
• Avg Aggression Factor: 1.64

Profit/Loss:$55.21

Total $71.21

I have just completed a hand history review of my cash game play and will be trying a few new things next month so fingers crossed I will hit 3 figures. I have also started a lowball home game group. I will need to pick up my volume a bit this month and get my connection issues sorted.

Poker Software

• Smart Buddy
• Tournament Shark
• Table Ninja
• Troutulator
• Holdem Manager
• Poker Hands
• Poker Stove
• SitNGo Wizard

Hold’em Manager Professional

If you are playing No Limit Hold’em online you need to have Hold’em Manager. This software tracks every hand you and your opponents play and stores them in a database. Hold’em Manager also includes a HUD so you can quickly and accurately analyze your opponents tendencies. Another excellent Hold’em Manager feature is the ability to see mucked cards without the need to open the instant hand history window. Below is my HUD setup for sit and go’s.

TableNinja

This is an excellent tool that makes multi-tabling that much easier. Simply setup your hotkeys and predefined bet amounts and you will save yourself a lot of repetitive mouse actions. I can quite easily 24 table sit and go’s with this tool. My optimal level of tables is about 16 at the moment though. The video below gives you a short introduction to table ninja. One of my favorite features is the Big Blind overlay for sit and go’s this is helpful for making quick decisions

SitNGo Wizard

SitNGo Wizard is a must have for every tournament player. SitNGo Wizard goes through your tournament history files and runs analysis on each hand. It compares the equity that you have from folding or going all in preflop. SitNGo Wizard  also has quiz mode this allows you to quickly learn optimal short stack strategy. The screenshots below show some analysis from some previous tournaments.

Smart Buddy

Smart Buddy tracks players and lets you know when your friends and fish are online and what table they are on. Once you have identified an opponent that you believe you have and edge on, add him to your list and every time he sits down you can pull up a seat to his left and have fun.

Tournament Shark

Tournament Shark is an excellent application that allows you to see the profitability of your opponents whilst sitting at the table. This gives you an edge and you can quickly identify the players you can target.

PokerStove

Pokerstove is the gold standard in equity calculation for No Limit Hold’em. This is a free tool that you can use to compare equity from one hand to another.

Troutulator

Troutulator is an equity calculator for other forms of poker. Troutulator can calculate equity for 7 card stud hi, 7 card stud h/l, badugi and 2-7 triple draw.

PokerHands

Poker Hands is similar to hold’em manager except it can be used for 5-card draw, badugi and 2-7 triple draw. You can download this program free however it is no longer being actively developed.

• Ten lessons I have learned about trading from poker.
• My Favourite poker Game.

There is a lot of debate about poker is it a skill game? Or is it simply gambling? My view is that poker is a game of skill with a luck component. I enjoy playing poker it I would consider it  an excellent hobby that has helped me increase my knowledge of applied probability. At the moment I am learning to play HU Sit & Go’s, these are really fun games which require a unique set of skills.

Poker Luck Meter

In both trading and poker you can lose a lot of money in the short run making correct decisions. In poker however there are several ways we can analyze or decisions to see if they are “correct”. Today we are going to have a look at an excellent free online tool called the poker luck meter. You simply upload your hand history files and sit back and let the analysis begin.

Poker Luck Meter in Action

In the past week I have played very little poker about 1600 hands. This is of course a very small sample size I did however felt happy with my play and for the most part I was pretty sure I got my money in good. It was a losing week for me. Lets upload my hands and see if I was played well and were unlucky or I was just playing bad.

Statistics

As you can see my expected all in winnings and my actual winning varied quite a bit. Also the likelihood of my having such bad luck into the future is around 7%.

Expected vs. Realized Winnings

Showdown vs. Non-Showdown Winnings

All-In Expectation vs. Realized Winnings

Conclusions

It would be foolish to try and draw any concrete conclusions from such a small sample of hands. I am sure the more hands I play the closer my realized profit will be to my expected profit. In poker and trading to be successful:

• You have to be a good loser.
• You have work on strategies to control your emotions. 
• Understand you will lose between 49% – 40% of the time (If you have an edge).
• Never stop learning.
• Connect with other traders players.
• Keep good records.

Next week I will go through the poker software I use and how it helps my game. Would love to get some feedback if you find these posts interesting or not please leave a comment below.

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There are three drawing rounds and four betting rounds. The game flow shown below:

Five cards dealt to each player
First Betting round -Starting with player to left of big blind player will choose to bet, check or raise if pot is not already capped.
Draw One – Player will choose to keep or discard any number of cards if he likes his hand he will change none and Stand Pat.

Second Betting round -Starting with player to left of big blind player will choose to bet, check or raise if pot is not already capped.
Draw Two – Player will then choose to keep or discard any number of cards if he likes his hand he will change none and Stand Pat.

Third Betting round -Starting with player to left of big blind player will choose to bet, check or raise if pot is not already capped.
Final Draw – Player will choose to keep or discard any number of cards if he likes his hand he will change zero and Stand Pat.

Final Betting round -Starting with player to left of big blind player will choose to bet, check or raise if pot is not already capped.
Showdown- Provided bets are called a showdown will occur and the lowest hand wins.

I know all this seems a bit complex but once you sit down at the table it will all make sense. Below is my equity graph from my last 10,000 hands, nothing impressive but I am still a student of the game.

Learning 2-7 Triple Draw

If you want to learn more about triple draw there are some great resources online and a chapter in the Super System two which should help you hit the ground running.

1. Triple the Gold Video Series on Deuces Cracked (Great training site subscription required).
2. Daniel Negreanu’s chapter on Triple draw from the Super System II. (Read online free).
3. Lowball guru’s excellent collection of articles on lowball.
4. Smack software- Free software that will overlay mucked cards on screen to save you going through Hand History.
5. Rubbish cards Troutulator -  Free software for equity calculations

The Long Run is Really Loooooooooong

It was not until I started playing poker that I made this realisation. I am sure most of you are familiar with the Keynes quote “In the long run we’re all dead”. Basic statistics tells us that carrying out an action that has a positive Expected value will result in profit over a large series of trials. So it should come as no surprise that over a short number of trials you can find yourself losing money as a result of a positive expected value decision.

A Poker Example

To make this more concrete at the $5.2 buy-in sit and go’s on average I have a 13% ROI over a sample of 534 games. If we look at a 16 game block I lost 12 of these games and only won four resulting in a net loss of $63.20. Looking at the short run one could say I am a losing player. Below is my graph of the full 500 games:

Note: Even 534 games is to small a sample size to say I am a winning player.

Trader Lesson: Just as 16 games is to small a sample to draw inferences from so to is 16 trades. At the end of the day you will make the most profit from continually making plus expected value decisions regardless of outcome. Try not to be fazed by a small number of losing trades stick to your system.

Psychology Matters

Depending on your vintage and or educational background you may or may not have heard of Daniel Kahneman and Amos Tversky. These two psychologists developed Prospect theory which is basically a theory that deals with evaluating alternative decisions involving risk. In short the theory evaluates how people evaluate gains and losses.

Poker Example

I lose 2 buy-ins playing NLHE cash games for a loss of $50. I then play 4 $6.50 sit and goes and run very well coming first in three games and 6th in my fourth game. I make a net profit of $55 in my sit and go’s and a $5 profit for the session. However this is a very disappointing session as I have only made $5 and I weight the loss of $50 as much greater then the gain of $55.

Trader Lesson: It takes a lot of hard work and discipline to not put so much emphasis on our losses and not to fall into the outcome bias trap. Our mental state can cause us to make minus expected value decisions. There is no shame in getting professional help to work through cognitive issues that impair our performance.

Note: The best resource on trading psychology is Brett Steenbarger, his traderfeed website has many great articles some recent articles I found useful are:

• Trading Scared is Trading Scarred
• Approaching Markets With an Active Mindset
• Learning How to Trade: Managing the Psychological Risks
• Four Best Practices for Maintaining Your Focus on Markets
• My Favorite Techniques for Overcoming Performance Anxiety in Trading

Rake and Commission Matter

On the face of it both poker and trading should be a zero sum game, that is individuals losses should directly match other individuals gains. Unfortunately due to commissions, rake and taxes losers lose more then winners gain and winners gain less then losers lose. Playing poker has given me a greater appreciation for the effect that taxes and commissions have on my bottom line.

Poker Example

When starting out I like most players started playing $1.10 games that is $1 entry fee plus 10c rake, in these games one is paying 10% rake.  Below is a very crude example of how rake would effect your profitability assuming ROI was the same for both stakes:

Profit on $1000 investment at $5.20

$1000 – 192 games 25% ROI 4% rake

$1250 rake reduces our ROI to 21% => $1210

Profit on $1000 investment at $1.10 Stake

$1000 – 909 Games 25% ROI 10% rake

$1250 rake reduces our ROI to 15% => $1150

Note: This is highly simplified and in the real world ROI incorporates rake.

The image below shows my results from $1.10 Sit and Go’s. You can see that I actually paid more in rake then I  made.

Trader Lesson: Commissions and taxes are often neglected when developing a trading plan or strategy however these two factors are crucial to long term profitability. When selecting a broker you should do a comparative analysis of fees commissions volume discounts offered. As far as taxes go your best bet is to talk to a good CPA or CA and they will be able to help you with this issue. You may be surprised how much money you can save by taking these measures.

The Environment is constantly Changing

In poker and trading adaptability is crucial aspect of success. Just because you have the best possible hand on any given street does not mean that it will still be best hand on the next street. In order to succeed you have to examine your play after each new piece of information becomes available. In poker you also have to realise when your beat and cut your losses just like a trading environment.

Poker Example

I am dealt pocket aces in an 8 handed game blinds are $15/$30. Two players limp in for $30 I raise it to $120 one limper fold and the button and other limper cold calls.

Stack sizes

Me: $1480

Button: $3070

Flop

Limper checks I lead out with a $288 bet button calls then limper folds.

My thought process: This is a very bad flop for me straight draw, flush draw, KQ would make a full house. I make a small continuation bet to hopefully win the pot here. My best possible starting hand no longer looks like it can win the pot.

I check button leads out and puts me all in. I fold he shows Jack Ten making a straight.

My thought process: This is a very bad card the straight just got there my opponent could also have trip queens, best case is he has AK or flush draw. I check  and my opponents over bet tells me he has me beat. Even though it is a spot where technically a call would also be correct I opted for the safe option.

The Odds

As you can see from the above simulation if we put our opponent on his tightest range, calling would have also been an option.

Trader Lesson: Financial markets are dynamic and constantly changing and it is important to realise when these changes will effect your trading plan. In times of late we have seen some significant structural changes in markets and regulations. These changes can prove profitable or costly if you are unsure it is best to stay on the sidelines as hard as that may be.

If you don’t have a strategy you may as well burn your money

It is very important that you have a strategy when you sit down at the poker table. Not only is a strategy crucial aspect of trading and poker but a framework for analysis is also required. I have found when I started playing poker I had no strategy and played very subjectively.

My Basic Poker Strategy

Pre-Flop

• What position am I in?
• How many players are in the pot?
• how many players are left to act?
• What is my M?
• What is my opponents M?

M=Stack size / (Big Blind + Small Blind +Antes)

• What equity does my hand have against opponents range.
• Bet/Check/Fold/Raise

Post Flop

• Calculate Pot odds
• Calculate Outs
• Factor in fold equity and psychological aspects
• Bet/Check/Fold/Raise

Post game

• Review game play as a whole.
• Calculate expected value for any hands that were borderline.
• Use an ICM calculator and do a hand by hand review.

Trading Lesson: It is not enough to just have a static trading plan, you will also need to have a framework in place to evaluate the success in a quantative fashion.  A trading diary is a great way to record your thoughts and reasons for entering or exiting any given trade. Sometimes the post trade analysis can be just as important as pre trading analysis.

Trying to Make back losses is the quickest way to lose

I have to admit that I on more then one occasion I have lost money playing poker and then told myself that I am not going to stop playing until I made that money back. Guess what happened, I lost more money trying to make that money back. On one occasion I lost 6 Sit and Go’s in a row at the $20 level so I thought I would move up to the $50 level and quickly lost more.

Trading Lesson: Sometimes the best thing to do after taking a big loss is to take a break recharge the batteries and step away from your trading station. That money is gone it is a sunk cost and is not recoverable. Don’t take on more risk or stay in trades longer then your trading plan dictates in an attempt to win back your losses

Bankroll Management and Money Management Make a Difference

Risk of ruin is real and no matter what your skill level if you don’t manage your poker bankroll or trading equity properly you could be out of the game. As a trader it is even more crucial as with some financial instrument you can lose more then your initial investment.

Poker Example

We sit down at a table with our last $1435 look down at our cards and see pocket aces, we know that against any combination of two cards we have a greater then 80% chance of winning. We raise the pot to $450 and our opponent puts us all in and turns over pocket queens.

AA vs QQ  gives us an 82% chance of winning. The final outcome is shown below:

As you can see even though we got our money in good we lost our whole bankroll. If on the other hand we had 50 buy ins for this level we would be able to re-buy and continue playing.

Trading Lesson: Don’t risk it all on one trade no matter what odds you are getting. It is crucial you develop a money management plan, it does not have to be complex. A quick and easy plan would be to never risk 2.5 % of your equity on more then one trade or highly correlated group of trades.

Variance is just part of the game

Variability of return’s can be a huge frustration but it is an inherent part of the game and it keeps the gamblers coming back for more.  When you play poker you have to expect periods of negative returns. In the graph below you can see a 100 game downswing at the $3.4 stake.

In these 100 games I did nothing different to any of my other games made the same decisions same plays however the outcome was a loss.

Trading Lesson: As a trader you are in a very uncertain business. Most academic texts will say that a good investment strategy will have a low standard deviation of returns. Some of the most profitable traders of all times had very high standard deviations of returns. My advice would be don’t try and minimise variation to much find a level that is acceptable to your risk profile and learn to accept variance.

There is no such thing as a shore thing

Poker and trading both seem to attract people looking to get rich quick. There is no shortage of people looking to sell you a product or service that will make you money while you sleep or will give you the hidden secret to untold wealth.

Trading Lesson: There are no shortcuts, no hidden secrets it will take hard work, dedication and many failures to achieve true success. Question everything you read and hear, if it sounds to good to be true it probably is.

Don’t Give up Your Day Job

The title says it all. You will hear a lot of poker professionals say this to up and coming poker players however I think it has a lot of value for traders also. I know a lot of people look at trading as a way to make a lot of money quit there job and enjoy the finer things in life. However this places you under enormous pressure, there will be times when there are no trades that meet your criteria but your family still need to eat.