4 ms·
Yes, but expected value isn't everything. A good investor considers the ratio of expected return to variance of return. In a normal game, the variance on an ove
by xapata 10y ago
Yes, but expected value isn't everything. A good investor considers the ratio of expected return to variance of return. In a normal game, the variance on an overbet is enormous and therefore the denominator of its Sharpe ratio [0] is large and drives the value (or should I say "score" so as not to get confused with "expected value"?) of that action down.
You'd happily go all-in pre-flop AA vs KK. On the other hand if you got 4-bet pre-flop by a 22 and you're holding AK, you might ask, "Check it down?" This is assuming the opponent really likes small pocket pairs and will call an all-in, etc.
[0] https://en.wikipedia.org/wiki/Sharpe_ratio https://en.wikipedia.org/wiki/Sharpe_ratio
- 6nf 10y ago> you might ask, "Check it down?" In a heads up game? Really? "Check it down?" ???
- xapata 10y agoThe example applies more to a ring game, where you might be going after a particular fish and don't want to get involved with a better player. Still, I think it illustrates the principle of trying to keep the variance down. Also, if you're first to act on the next round, it might be worth asking, even if you don't think they'll agree.
- 6nf 10y agoThat's collusion and it's not cool. No top pro would ever seriously ask to 'check it down' Kelly's criterion and the sharpe ratio is not relevant for the format played in these human-AI heads up games. They play with an unlimited bankroll.
- xapata 10y agoI'm not talking about a tournament. And yes, it could indicate collusion. But most of the time, it's just a friendly low- or mid-stakes game and the players are tired of thinking. My point exactly about the unlimited bankroll. The experimenters may not have realized that an unlimited bankroll would significantly affect the strategy.