Realities of Rake Pt. 2

Since writing realities of rake pt. 1, I've had the topic of rake come up in a bunch of interesting ways. Many of these, like the impetus for the first article, come from searching NYC for low-rake underground games. So as promised in part 1, I'm going to cover some theoretical changes we can make to our game based on rake and cover some other interesting rake examples I've heard about in the city. 

Theory of Rake

We can use a couple of basic theoretical concepts to inform us how rake should affect our game. Unlike other theory exercises where we may assume our opponents are playing correctly, I'm not going to assume our opponents account for rake at all. Instead, I'll assume our opponents have a strategy that exists wholly independently from rake or at least is based on some specific level or rake and does not adjust for changes.

Let's begin by considering preflop strategy, probably the easiest and most important rake-related adjustment. The worst hand in our opening range should have an expectation of roughly 0. In other words, we should be indifferent to opening this hand or folding it. When rake increases and our opponents strategies stay fixed, this hand will now have a negative expectation. In fact, every hand in our range will have a lower expectation. Therefore, some percentage of our opening range will go from having positive EV to negative EV. 

This brings up our first adjustment. If our opening range is theoretically correct at one rake, then we should open fewer hands at a higher rake and more hands at a lower rake. That is extremely simple but also extremely powerful. Do your ranges have a difference playing 1/2 at the Planet Hollywood vs 1/2 at Caesar's? In theory, there should be (assuming our opponents play the same in both rooms).

The natural follow-up question is how much should we adjust. A specific answer is impossible, even even a truly accurate set of guidelines will take a lot of work. I'm going to settle for an answer that gives us an estimate for roughly half of the equation. 

We said in part 1 that skilled players pay about 2.2 full rakes per hour in a full ring game assuming 25 hands are dealt per hour. Therefore, an increase in rake by $1 would average out to a little under $.1 per hand. However, since the rake we contribute probably comes from 4-5 hands in this timeframe, our rake is really increasing by closer to $.5 per hand played. That is a significant increase and will have a meaningful effect on our opening range.

Postflop effects are much more subtle. The main effect is that dollars in the pot over a certain point are more valuable than dollars in the pot below that point. For example, if the rake is 10% up to $5, then every dollar put in postflop above $50 in the pot is more valuable than the dollars put in before. Most pots will be so close to that threshold after the flop that the effects on decision making should be negligible. However, there is a game that will be discussed later on this article where these effects may be worth considering.

Rake Strategies

Many players will be familiar with the phrase "No flop no drop". This means that rake is only taken out of pots that reach the flop. When this is the case, we are incentivized to win more pots preflop and play fewer pots that see a flop. The consequence is that our 3+betting frequencies should be higher than in a game where rake is always taken out. Our value hands that are indifferent to flatting or 3-betting in a game where rake is always taken out become 3-bets when rake is only taken out after the flop. When we add value 3-bets, we add 3-bet bluffs. Naturally, this holds true for 4-betting and beyond. 

One other important thing worth mentioning is to always ask for reduced rake when possible. Most casinos allow for reduced rake when the table gets short. Always be pesky about demanding this or else your rake will be higher than necessary.

More NYC Game Analysis

I recently heard about two very interesting NYC games with unusual rake structures. The first rake structure seems steep at first, but I actually think its very favorable. That game is a 5/5 game with an entry fee of $100. Yikes, who wants to pay $100 to play? Of course, for those who have read my articles, you are probably realizing how favorable this is to most other games I have available to me. In NYC, I have never heard of a raked game with less than 10% up to $10 (and that is basically always 1/2). In a game with 10% up to 10, we are paying about $20/hr in rake. Therefore, this 5/5 game becomes a better rake structure after just 5 hours. I also can play more hands which will increase my achievable winrate. 

The other game I heard about had a much less favorable rake structure. While the game was described as deep and incredible juicy, the rake was 10% up to $35. Based on my math from part 1, our rake paid per hour is about $45. That means our winrate will be our true winrate-$45. If this is a game where we can make 15bb/hr, AKA a game where people are giving it away, then we can definitely justify the variance to play this game over another game where we can acheive a 3-4bb/hr winrate. 

Timed Rake vs Rake from Pots

It's widely held that a timed rake, or rake paid on an hourly or half-hourly basis, is superior to rake taken out of the pot. This will often be true. In a 5/10 game where we pay $10/30 mins, we will save money compared with our rake paid proportional to a $2/$5 game. However, a big part of determining the value of timed rake is hands played per hour. In a game where we only see 15 hands per hour, the rake suddenly looks much worse.

The pace of the game is often what drives casinos to switch to time-based rake (no, its not always the kindness of their hearts). Therefore, it is often in the interest of the skilled player to keep these games moving! Don't worry about etiquette since the action players will likely see you as more of a hero than a villain. Just kindly remind the tankers that they are using everyone else's money to make their decision. 

Conclusion

The number one takeaway for me is that rake is well worth considering. There are some games where rake will either eliminate our advantage or reduce it to an amount that is not worth pursuing. While rake will only ever effect our more marginal decisions, there are natural adjustments that rake demands. Finally, NYC poker is expensive, but the fish make it all worthwhile.