br and investing

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Uptown . Nov 25 2008 04:39. Posts 3557

*note: this is mainly me talking to myself so that I can come back to this when I have more concrete thoughts. It's mainly going to be rambling.

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For the past couple of days I've been wondering the proper balance between maintaining a bank roll, and diverting portions of it into investments. In theory, BR money above your personal minimum should be invested because money inside your poker account is essentially 'dead money' that is losing value every second. So for a NL100 player who likes to be rolled at 25bi, it would mean sending anything over $2500 into your portfolio. But obviously things aren't ideal...

What things affect this "ideal" scenario?

- The need for insurance against hard downswings
- Relative illiquidity of many investment options
- Deposit limits

Sudden downswings mean that oftentimes you will need to bring back your money from your portfolio back into your account to be properly rolled. But turning your stocks/bonds/etc into cash on short notice is not an optimal plan for your investment goals. In addition, depending on the size of your br and the limits you play, I believe you won't necessarily be able to stick enough cash back in asap.

Then on top of this, is the fact that many players are looking to "build" their br so they can move up in stakes, rather than continuously grind at their current state.

I sense that if I went through the math of common transaction fees, rates of interest, deposit fees, etc there would be a way to compose some form of structure that is better than simply having a massive pile of cash sitting in one's poker account. The effects of this kind of 'optimization' should grow exponentially as one's br becomes larger.

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It's completely irrelevant for me atm as I am a lowly nl2 player who recently migrated from TL.net, but it just got me thinking.

0 votes

Half Pot!

whamm! Albania. Nov 25 2008 05:17. Posts 11625

dont worry about things like this yet. the higher the limit, the higher the buffer obv

Silver_nz New Zealand. Nov 25 2008 05:20. Posts 5647

these are some good things to think about.. I've been thinking along similar lines lately. Was looking at it from the perspective of net assets, currently I have over half of my personal assets "invested" in poker stars. its hardly an ideal situation from an investment standpoint. Even though I trust pokerstars its just a bad idea to have most of your eggs in one basket. I've yet to actually think out a good plan for my situation though... def some thing i need to do

PM me your msn if you want to talk more about this and/or want help with poker

JYang United States. Nov 25 2008 12:15. Posts 2669

i think the cut off point for poker/investing bankroll is like $30,000

u'll have enough bankroll to shot take 1000nl which is high stakes, and u have also the ability to grind ~400-600nl midstakes without fearin about anything related to going busto.

then u can start to save and invest

that's just my take

the jump from midstakes to high stakes is very big and most people would be doing fine grinding midstakes and saving $ to pick up some solid investments

vegable United States. Nov 25 2008 14:46. Posts 2453

Stir fry Normandy