Realities of Rake: Part 1

Rake is one of the most important elements of any poker game. It is extremely predictable. It is a factor in every single hand. However, it is rarely discussed in a meaningful way. A simple question recently brought this to my attention. If I get a $75 bonus for playing a 4 hr 2/5 session with a $15max rake, how much additional rake could I take on to achieve my same winrate playing in a game with a $7 cap?

I suddenly felt quite embarrassed that I didn't know an easy way to determine the answer. Like a good millennial, I turned to google. What I found was shocking. No one seems to be talking about rake, especially outside of the context of rakeback. I decided to fix that. First, a bit more on how I got to this point.

My Move to the Big Apple

I recently moved to NYC, a poker home game mecca, but a casino desert. My girlfriend got an amazing job in the city, and NYC has other serious perks for me. However, the convenience of having a 24/7 casino with non-stop poker action is something I'm really beginning to miss.

Don't feel too badly for me. I'm making regular trips to Parx, and the new MGM resort in DC, both places with 2/5 action far superior to Cleveland, my former home. I'm also on the lookout for zero-rake home games and we just had our very first NYC-based Just Hands home game (in fact, if you ever need another player for your game or want to participate in the Just Hands home game, email me at jack@justhandspoker.com). Still, there is something really attractive about being able to walk in somewhere with a game set up whenever you want. In NYC, underground games are the closest you will get.

A little more background on myself. My live career actually began playing at American Indian casinos and NYC underground games. They both have a much greater tolerance for <21s. The underground games are a ton of fun. The action is great, the atmosphere is edgy, and the players aren't at any legal risk. These games do get raided, so having a ton of cash on the table is a bit risky, but most games will pay out if you can pocket your chips or otherwise prove your stack. 

The Truth About Underground Games

Yes, the rake is too damn high. When I was 19, I didn't really know or care that the rake was so high. I played in underground 1/2 games where the rake was 10% up to $14. If I'd realized quite the effect that this rake had on my expectation, I'd have probably thought twice. However, there were other factors that made the rake seem more tolerable.

For one, the game offered a 10% bonus up to $300. If I bought in for $300 (the max) and committed to 2 hours of play (I could leave if I was felted), then the house would add $30 to my stack. Nothing like free money, right? 

Wrong! Actually, the free money is nice, but it's not worth the rake. We'll get into the math in a second, but even with the free money, the rake makes the game tough to justify playing. I wouldn't say the games aren't beatable. It's just not really worth grinding out an xbb/hr winrate in a 1/2 or 2/5 game for me. Add in tip and the fact that dealers routinely take out more rake than they should (they often get paid half the drop), and you have a recipe for 10-15bb in rake per hour. 

How much rake do we pay?

This is an extremely important question for determining if a game is worth playing. We need this information to figure out our true winrate and use that to evaluate potential poker opportunities. Now this seems like the type of thing we should be able to just look up, but it's actually quite complex, so we'll need to do a little bit of math.

While bb/hand numbers are the most transferable (underground games tend to be faster with fewer casino regulations), bb/hr tends to be easier for making decisions about whether games are worth playing. So let's lay down a few numbers/assumptions to get a general sense of rake.

The average live game sees about 20-25 hands an hour. Factoring in small pots and pots taken down preflop, about 15 full rakes come out of the pot every hour. Given that skilled players are likely winning more than their fair share, let's say they pay the rake of 1.3 people. In very tight games, this will be higher while in very loose games this will be lower (another reason for game selecting). 

Therefore, at a 9-handed table, the winning player should expect to pay around 2.2*full-rake/hr. In Cleveland, this comes out to about $15/hr in rake with a $7 max rake. The rake is the same for 1/3 and 2/5 and was the same for 1/2 back when that ran. Therefore, a break-even player has a pre-rake winrate of 5bb/hr, 3bb/hr, and 7.5bb/hr respectively. In truth, 1/2 games will not make full-rake quite as often, but it's still very common. 

When does a bonus make up for rake?

I recently got the following message as part of a mass text for an underground game. "Special promotion this week only!! 75 anytime bonus for 2/5 game starts at 3:30 PM". I know that the rake in this game has fluctuated, so I wanted to figure out what was the maximum rake where I could expect roughly the same winrate over a 4-hour session as I made in the Cleveland games with a 10% up to $7 max-rake. I would expect the rake at this game to be 10% up to some dollar amount. 

So we have established that I'm paying roughly $15/hr on rake in Cleveland. For this comparison, I'll convert that to 60c/hand given 25 hands of play an hour. Of course, as the max rake increases, the likelihood that it will be reached diminishes. I'm sure a more robust calculation exists, but I'll just estimate here. Every extra dollar of max rake over $7 will mean 2% fewer max pots. Finally, let's say that underground games will see 30 hands an hour and that dealers are stealing $1/pot.

The following are the differences in expectation over 4 hours due to the bonus and rake difference.

Printed rake : BB/hr WR difference

  • 10 : 0.45 bb/hr
  • 12 : -.038 bb/hr
  • 15 : -1.49 bb/hr
  • 18 : -2.44 bb/hr
  • 20 : -3.00 bb/hr
  • 21 : -3.26 bb/hr

So the actual rake of the game was 10% up to $21 meaning that even with the $75 bonus, my WR would be 3.26bb/hr lower. Without the bonus, my WR would be over 7bb/hr less.

Conclusions and Previews

The verdict on the underground game at this point is that the bonus makes the game playable, but is still far worse than other poker options. Even with the bonus, I'd make $30/hr more playing in an unraked home game with the same base WR. 

However, the underground game with the $30 bonus is extremely difficult to beat. Using a similar calculation, even with the $30 bonus, I'd need to be beating the game at 14bb/hr to break even. 

So what is coming in part 2? I'm going to explore ways we can alter our style to avoid rake and assess how those strategies apply for a high-rake underground game as well as for a low-stakes casino game where hourly rake can still add up to 5+bb/hr. I'll also be examining the difference in rake and WR between 2/5 and time-raked 5/10 games.

Until then, please feel free to post any questions, thoughts, or corrections in the comments below, or email me at jack@justhandspoker.com.