Understanding Rake in Poker

1. Understanding Rake in Poker You might have heard the term “Rake” popping up often around poker related discussions and in this article we will take a detailed look in all aspects of it such as, what is it, what is the general standard both in low and high stakes cash games as well as tournaments, how it has changed over the years, how it effects your game and how to use it to earn extra income and other elements. What is Rake? All Pokersites/clubs/casinos employ a large no of employees and invest a huge amount in creating and maintaining their infrastructure. To get returns on their investment they charge a percentage of the money from the winner every time he wins from another player. This percentage in poker terms is called as rake. Wikipedia describes rake as “Rake is the scaled commission fee taken by a cardroom operating a poker game.” Poker is a game of variance and equity. Rake when added to the mix can make the whole game unbeatable if not understood properly.

2. Rake In Tournaments Pokersites often charge a percentage of your tournament buyin normally around 10% as rake. So say your tournament buyin is 250 then 25 will have to be given as rake. This amount is not included in the prizepool. Rake back in tournaments is given by some sites in terms of leaderboard where some extra incentives are given to players who take part in multiple tournaments. Unlike cash games you have to make a place it the money in order to get eligible points for leaderboard. Rake in Cash Games •Low and middle stakes : In present indian online poker cash game rooms rake is around 5% with a cap of around 15-20 BB (Big Blinds). The rake is very high in indian online poker sites compared to international operators. This image is from a typical 6 max cash game with blinds at 2/4. •The min and max buyin in this room stand at 80 and 400 or 20 BB and 100 BB respectively. •The rake has a cap of 12.5 BB in 4 way pot and 18.75 in all other. •HU rake is 4% and cap is 12.5 BB Cap is the maximum rake that the house will take from a pot so when the cap is 50 then irrespective of the pot size the house will not take more than 50 Rs

3. •Heads up Say you buyin with 50 BB or Rs 200 and go all in against another player with the same number of chips. The Winner will give 4% of 400 as rake i.e 16 (4 BB). If both players had max buyin and had gone all in then the rake would have been 4 % of 800 or 32 (8 BB) *Note: In higher stakes the cap would have been hit at 4 BB. •Three way A three way pot with all players shoving with max buyin will generate a rake of 5% of 1200 being 60 (15 BB) but since the rake is capped at 50 (12.5 BB) only that amount would be deducted 1.High Stakes In high stakes table i.e 50/100 and above rake is slightly less i.e 4 % for multi pot and 3% for Heads Up pots but the major difference lies in the rake cap which for three way action is limited to 4 BB and for more to 5 BB, this means that you will hit the cap a decent number of times compared to small stakes where it will be very hard to hit max cap even if full stacks at max buyins shove. This means that the rake charged in terms of percentage is much lower compared to small stake games. Rakes in high stakes are comparable to international operators.

4. What it all means? •Heads up Say you buyin with 50 BB or Rs 5000 and go all in against another player with the same number of chips. The Winner will give 3% of 10000 as rake i.e 300 (3 BB) if both players had max buyin and had gone all in then the rake would have been 3 % of 20000 or 600 (6 BB) but since the rakes are capped at 400 (4 BB) only that amount would be taken from the pot •Three Way A three way pot with all players shoving with max buyin will generate a rake of 4% of 30000 being 1200 (12 BB) but since the rake is capped at 500 (5 BB) only that amount would be deducted. How does rake affect gameplay? Imagine a game where there is no blind and no rake. How would you play such a game? You would fold every hand and wait for AA. Blinds are put in the game so that players are forced to pay some hands instead of waiting forever for AA. Let’s put in some blinds in the mix, now even the tightest of players would increase their range to include hands like KK, QQ etc otherwise they would simply bleed their stacks to blinds. This is called extending your range or increasing the no or type of hands that you play. Let’s finally add rake, now as an additional fees on top of blinds a player will have to extend his range further in order to remain profitable. That’s how rake affects your game play in the longer run, it extends your range and makes you play more no and type of hands. In certain situations it also influences decision process while in the game, seasoned players avoid raising hands with a high percentage chance of getting split to avoid shelling out more rake. Pokersites which have a very good rakeback program would see a lot of grinders on the tables with a standard multitable tight range play while other sites with not so good rake back plans would see a lot of exploitative pros in action. Is poker beatable with rake Say you are a super NIT kind of player which means a super tight and safe player and only open with the top 2.4% range i.e AA,KK,QQ,JJ,10s and AKs and are willing to go all in with a player who has 20% range i.e 66 pair plus and all suited and off suit broadways. See image for 20 % range.

5. Equity analysis of both ranges will put the NIT (Player A) favorable at 70.14% which means that out of every 10 hands he plays he will win 7 and loose 3 making his net to 4 in profit. If both players decide to play 10 games (4000 Bankroll) with max buy in of Rs. 400 and get into this all in game then •Player A will gain a profit of 4*400 i.e 1600 and his balance should be 5600 (a profit of 1600 on top of 4000 bankroll) •Player B who has lost the same amount but won 3 times which has been discounted should have an amount of 4000 -1600 i.e 2400 in his account But far from it If we put in rake then:- •Every 7 times Player A won he had to give 32*7 = 224 as rake (224/1600 = 14 % effective rake on profit) so instead of 5600 his balance will only be 5376 •Player B who is in the negative also had to pay rake for the three games he won (32*3 = 96) making his balance to show 2304 instead of 2400. Player A B Profit without rake 1600 -1600 Profit after rake 1376 -1696 Difference 14% 6%

6. You might argue that if we play with the NIT range always then we don’t mind the rake as we are winning 70 % of the time but that is not the case in practical purposes. If your starting range is 2.4% then you will be playing only 2 or max 3 hands per 100 hands dealt and that means that you are not playing 97 hands. In a 6 max table every orbit or 6 hands you will have to shell 1.5 BB as blinds thus in 100 hands 24 BB or 96 will be simply dropped as blinds. We also cannot assume that every time you go all-in you get action so half your action will be dead reducing your profitability further. •So say every 100 hands you get action twice then it would take you 500 hands to go all in 10 times and win 7 times. •In 500 hands you would have paid 5*24 = 120 BB or 480 as blinds. This brings your effective profit further down from 1376 to 896. Add a 30% tax and voila 268.8 as profit when you play for 5 hours and also risk variance with your own money. *Interesting Fact - India’s minimum wage for semiskilled work in delhi for 2018-2019 is 592. So even if you work for 10 hours playing poker you are not even making minimum wage. Even if you have AA pre flop then also against a hand like KK you are suppose to lose 17.36 % of the time but the 82.64 % of the time that you win you are giving away 4% of it as rake thus making it a loosing scenario for you unless you eliminate rake somehow. Is rake good or bad? Now everything that we have written so far makes it look like rake is the biggest enemy you have out there and it is true. But what if you could make a deal with the devil? A lot of poker sites and rakeback providers like Whispershouts give a percentage of rake that you generate back to you in form of cash or rewards so that you continue playing on a particular site. This allows players even at breakeven to earn a decent amount via grinding on multiple tables. So for short term players who like to gamble and have fun every now and then rake is not an area of concern but for people who want to play for living or at least as an additional source of income rake can be both good and bad dependent on how it is applies to your objectives. Earning via rake is a time consuming process which involves a lot of grinding and is not for everybody but if you intend to make poker as a career then it is a cost of doing business. In short for pros who look to play exploitative shorter sessions rake is not your friend whilst for grinders who have access to rakeback plans rake can be a stable source of income generation.