--- In vpFREE@yahoogroups.com, "Mickey" wrote:
>Roy Cooke, a former Cardplayer colmnist, and Bellagio middle limit holdem player said it best "The recurring sum of net edge times volume equals the earn."
Good saying but needs the caveat that you need a certain minimum amount of "volume". How much volume? More than N0. (N0=variance/edge^2 bets, about 260K hands of perfect play FPDW+.25%CB). What's so magic about N0? At that point edge equals luck, so at less than, luck is still ahead, at greater than, edge is ahead. And for tax purposes you'd better be able to lay down N0 or more plays in the current calendar year, since you can't carry forward gambling losses. So, for example, if you find a hot play in December, it may not make tax sense to start playing until January, so that you get a full tax year. And your play in December is very much a function of whether or not you are currently ahead or behind in the year. And of course you need a bankroll that can sustain this level of play, suggest at least always greater than bet size times variance divided by edge (2600 bets at perfect play FPDW+.25%CB).
Just remember these formulas:
1) Kelly bankroll is approximately variance/edge bets
2) N0 is variance/edge^2 plays
3) edge has to be the real edge on the field, not a theoretical computer perfect couch quarterback edge, and to a lesser effect, make sure you are not doing things that will increase your variance, such as going aggressively after coin flips, or when you have equal EV options, going for the one with more variance
Your running bankroll needs to be always more than Kelly (betsize times variance/edge) and you need to be able to play more than N0 plays (variance/edge^2) in the current tax year and you need to be sure of what your actual edge and variance are on the field including the chearleaders, stadium lights, free drugs, and other distraction effects.
http://www.youtube.com/watch?v=TTbMNphP7Eo
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