Unlocking Poker's Profitability: Understanding Effective Rake and Your Edge
When it comes to poker, the most critical calculation goes beyond mere cards and odds—it's about maximizing profitability. Enter "Table Profitability," a misunderstood gem in the world of poker, combining factors like overall rake, rakeback, player edges, and table positions. This often overlooked aspect of the game holds the key to turning an average poker session into a winning one, even for seasoned professionals.
What is effective rake?
Effective rake is simply the overall rake that you pay minus any rakeback and promotions that you receive. Poker sites will specify their rake structure on their website in terms of a % of each pot that they will take, capped at a certain amount. For example 5% rake with a $4 cap means that they will take 5% of every pot (usually only if a flop is seen) up to $4.
Poker sites will also usually offer rakeback which is where they give you a percentage of the rake you paid back as a reward for playing, which can range from 0 - 50%.
Effective Rake = Rake - Rakeback
Ok, this is just the beginning, and while it may seem simple, most people—including many professionals—tend to stop their analysis here. Lets go deeper and figure out the intricacies of whether a game is truly beatable, and for that we need to define your poker edge.
How to determine your edge in poker:
While understanding effective rake is essential, the real game-changer lies in determining your edge. Serious players gauge their performance using win rates, measured in big blinds per 100 hands (BB/100). This comparative metric highlights how successful you are compared to others playing different stakes and/or volume of hands. So if you are playing $1/2 Pot Limit Omaha and you win $20 in 100 hands, you would have made 10 big blinds and your win rate would be 10 BB/100 after rake.
So in order to factor rake in to the equation we need to think about rake in terms of BB/100 too. This can be done simply with poker tracking software such as Hold’em Manager 3 or DriveHUD 2 and will show the exact rake you pay in BB/100. However I have outlined some estimates below of common 5% rake structures with various caps (note that this is dependent on playing style):
3BB Cap (e.g $6 in a $1/2 game) = 13 BB/100
2BB Cap (e.g. $4 in a $1/2 game) = 11 BB/100
1.5BB Cap (e.g. $3 in a $1/2 game) = 10 BB/100
Understanding Your Opponents:
Determining your edge also involves an in-depth population analysis of your opponents. Group players into categories like solid regulars, weak regulars, fish, and whales. Keep the categories limited to maintain the accuracy of your estimate. Once you've categorized players in your database, assign win rates to these specific groups.
You now have the ability to calculate the edge that you have over specific types of opponents at the table. For example if there is you and another strong regular at the table and you both earn a 10 BB/100 win rate, you can say that you have 0 edge against each other. At PLO Poker Coaching we offer access to our own database analyses with player categories and win rates.
Now lets make it profitable:
Applying this knowledge is key to finding profitable games. Start by figuring out the effective rake the entire table is paying. Assuming each player is paying 10 BB/100 in rake and receiving 50% rakeback, each player's effective rake is 5 BB/100. Multiply the effective rake by the number of players at the table (e.g., 6), and you get the effective rake of the table, e.g., 30 BB/100, that is being paid to the poker site.
So in a simple example we could say that we need one whale that is losing at -30 BB/100 in order to make the game breakeven amongst the other 5 players who are of equal skill, and have no edge on each other. At first glance we would see that this game isn’t profitable: We are splitting up the whale’s losses between the other players and all that is doing is covering the effective rake we are paying to the poker site. Doesn’t look promising. Our example table may look something like the below:
But we are not factoring in position at the table yet, which plays a major role in profitability. The player directly to the left of the whale is going to be able to play almost every pot in position vs. the weaker player. And if we still assume that the skill of the 5 regulars is the same, that will give him an additional edge and increased win rate to the detriment of the other players (poker is a zero sum game). This is starting to look a bit more promising for the player directly to the left of the whale:
However keep in mind that not all regular players will be of equal ability. Factor in the win rates by opponent classification to better evaluate your position. For instance, even if you're in the "Jesus seat" next to a whale, facing two tough PLO crushers on your left could turn your spot into a losing proposition and look more like the below:
Conclusion: Elevate Your Poker Game
Understanding effective rake, your edge, and the dynamics of table positions are essential skills that can transform your poker success. Ignoring these factors can even make beating weaker players a challenge. Take time to analyze the rake you pay and your perceived edge against opponents, as well as your positional advantage / disadvantage.
Unlock the full potential of profitable games by mastering these critical calculations. Embrace the strategic nuances, and you'll position yourself for consistent winning performances—whether at live or online tables. Good luck and remember, the smarter you play, the luckier you’ll be.
If you want to learn more and elevate your game, visit PLO Poker Coaching to schedule your free consultation.
