Ideas on cashing out from bankroll?

[Aslan]

If you got a RoR for reinvesting your winnings, as they all seem to be. If you take your winnings the RoR that was calculated is not correct. You were deluding yourself to call that your RoR. Yes you would go back to your original RoR but what you quote as your RoR is not actually your RoR because you are not reinvesting your profits. Your original RoR was some higher percentage than what was calculated using the calculators. I keep referring to Don's statement that if you don't go bust quickly you probably won't go bust. That is because your BR is growing. If you don't allow it to grow you are always in that starting period where you are far more likely to go bust. Think about that for a minute.A certain size downswing will bust you. If you grow your BR much you are probably out of the woods and much more unlikely to bust. is is part of the RoR percentage. If you never grow your BR you are always in the higher percentage part for going bust. Your RoR is therefore much higher than the calculator told you it was. The RoR calculators output is not your RoR because you never grow your BR to a point that you are probably out of the woods.

I don't think Don's comments envisioned you never taking your winnings, but growing it until the day you die. That doesn't make any sense at all. Don considers ROR to be all the money you "win" in a lifetime, not all the money you keep in your bankroll. Let's say I had $100,000 to play a $25 game. Do you seriously think that I am at risk of losing my bankroll because I am taking all my winnings off the top? There is little chance of losing it all. I would measure my lifetime "winnings" over my lifetime losses, not what I still had in my bankroll per se.

Where the real risk is is when a noobie has the bare minimum bankroll to get himself started so that it doesn't take much to wipe him out. He obviously does not have a replenishable BR, and everything depends on his getting lucky to start with, because although he is playing with an advabtage, he is really gambling to a very large extent. You might say his long run is too short for comfort.

[Aslan]

Let's put it this way, I believe that ROR in the finite sense means doubling your money, not your bankroll.

[Three]

I consider ruin busting your BR. I am pretty sure that is what most people would call ruin and that is what ruin in RoR stands for. You are trying to redefine terms in some semantic argument. If you had not taken the profits from your BR the RoR from your BR would be getting smaller as it grows. BR growth is calculated into the RoR percentage. If you don't allow BR growth then you are playing to a higher RoR than the RoR calculator tells you.

This is one of those it depends on your situation things. As someone with a huge BR you can see taking profits as no big deal because you are still playing with essentially a 0 RoR. You advise people it is no big deal to spend your profits but the guy with a high RoR listens to you and almost certainly goes bust. He keeps going to the top of the cliff and diving off at dangerously low tide from the top of the cliff. The other guy that let his BR grow is diving from a lower and lower spot on the cliff and waiting for high tide to dive. Either could die on their next dive but one is much more certain to die. The other will eventually be at the waters edge , not 200 feet up the cliff. Nyne explained it well for those that don't understand how much to take and how much you should grow your BR before considering taking anything. Giving advise that they should spend their profits because it makes no difference to you and then when they go bust telling them they should have been properly BR'ed to begin with isn't being helpful.

[Aslan]

I consider ruin busting your BR. I am pretty sure that is what most people would call ruin and that is what ruin in RoR stands for. You are trying to redefine terms in some semantic argument. If you had not taken the profits from your BR the RoR from your BR would be getting smaller as it grows. BR growth is calculated into the RoR percentage. If you don't allow BR growth then you are playing to a higher RoR than the RoR calculator tells you.

This is one of those it depends on your situation things. As someone with a huge BR you can see taking profits as no big deal because you are still playing with essentially a 0 RoR. You advise people it is no big deal to spend your profits but the guy with a high RoR listens to you and almost certainly goes bust. He keeps going to the top of the cliff and diving off at dangerously low tide from the top of the cliff. The other guy that let his BR grow is diving from a lower and lower spot on the cliff and waiting for high tide to dive. Either could die on their next dive but one is much more certain to die. The other will eventually be at the waters edge , not 200 feet up the cliff. Nyne explained it well for those that don't understand how much to take and how much you should grow your BR before considering taking anything. Giving advise that they should spend their profits because it makes no difference to you and then when they go bust telling them they should have been properly BR'ed to begin with isn't being helpful.

You are mischaractrizing what I said, Tthree. Go back and read what I've written. I have not advised people to spend their winnings.

Now, is it wise to keep some of those winnings aside? Yes! Let's say your expected win rate accounted for $1,000 of that $5,000 gain. In that case, $4,000 was positive variance. You are just as likely to have $4,000 of negative variance in the future. No, I am not saying that the money will even out-- it's the same as the law of large numbers. What I am saying is, the variance is so steep at blackjack that it's alway wise to save some of your winnings for those rainy days. This in effect decreases your risk of ruin below the 1%, if it were properly calculated in the first place.

I actually advise people to keep a part of their winnings, If you don't, you'll eventually realize that 1%, so I guess I agree with you that even though you've won $50,000 you have been ruined because you lost your entire bankroll. I speak from a replenishable bankroll, and I am not ever going to run out of money to devote to BR. It's different if your BR is all you have in the world.

My only point was that the ROR calculation is not different if you spend all your winnings. If you started with a $10,000 BR and a 1% ROR and you spend $50,000 of your winnings, and you still only have $10,000, your ROR is not diminished by your spending off the top. It is still 1%. You 'll never double your bankroll, of course, if you keep spending your profits and eventually you will probably go broke, but you did not change your ROR when you spent the $50,000 off the top. If you do start losing, your ROR position changes unless you replace what you lost. If you do not replace it, your chances of ruin are higher.

As a practical matter, if I lose $2,000 of my $10,000, I replace it, so that I am always playing with the same ROR. In effect, that is what a replenishable bankroll is. I replenish it as needed, which hopefully isn't often..

[hitA7]

Hi mushin

I have taken a different approach. If you have built your bank up, there is always bank money sitting idle that is doing nothing and earning nothing if it is in a savings a/c etc. I look for anything I can buy that I can turn around and resell for a profit. If you have ready cash available, you will be surprised at how cheaply you can buy things to resell. There is always someone who has something they need to get rid of quickly and will cut the price just to make a quick sale. So, if you buy a cheap 4 wheeler, lawn equipment, trailer etc and turn a quick 2 or 3 hundred dollar profit from the resale, there is 2 or 3 hundred bucks that is not included in your ROR that is available for withdrawal and you haven't touched your bankroll.

yes....this is exactly what i do with my "idle" money. specifically turning around high end music instruments & recording gear. Avg a couple hundred bucks a month in profit from that cash that would otherwise be sitting collecting dust, or in my sock drawer waiting to be used!

[Bodarc]

If your ROR is, say, 1%, and your bankroll is $10,000, and you go on to win $5,000, what hapens if you spend tIfntire $5,000 and are back at $10,000. What is your ROR now? It's still 1% of course. Your ROR is based on your starting amount.

If you keep spending your winnings and always play with the same bankroll (a non replenishable one) eventually you will be the 1%.

[Three]

Sorry Aslan. I was just worried people with inadequate BR's would follow your advice and go broke despite having a long term profit.

My only point was that the ROR calculation is not different if you spend all your winnings. If you started with a $10,000 BR and a 1% ROR and you spend $50,000 of your winnings, and you still only have $10,000, your ROR is not diminished by your spending off the top. It is still 1%.

If the RoR calculator tells you your RoR is 1% and you keep spending your profits, your RoR was not 1% to begin with. At least for your dedicated BR. If you just put the money aside to be returned if needed that is a different matter. People talk about RoR to make sure they don't run out of funds. If the winnings are no longer available it is the same as a loss from that perspective. But if you look at RoR as not being behind in the long run more than your initial BR even if you end up with no money to play with because you spent it all than the RoR calculation was right but was a useless metric because now you can't play anymore even though you are ahead $50K but spent that $50K.

[Aslan]

If you keep spending your winnings and always play with the same bankroll (a non replenishable one) eventually you will be the 1%.

That's what I say. So then you should ideally start with much less than a 1%ROR if at all possible. A $50,000 BR is much better than a $25,000 bankroll for playing a $25 game. There is a point where your risk is really minimal, and it's not 4 times your initial bankroll. Ask Don where that is.

Like Don says if you experience ruin it will probably be early because you BR should be growing.

Now part of what he means may have to do with beginners not playing a perfect game. If you begin counting cards before you have perfected your routine, your risk skyrockets, but it's not due to a faulty ROR.

That's why experts say that until you reach a certain level when you first start out, you may or may not make it even when you reinvest all your winnings. But if I thought I stood to lose $100,000 playing a $25 game based on bad luck, I would never have begun in the first place. I am not a gambler at heart.

[Aslan]

Sorry Aslan. I was just worried people with inadequate BR's would follow your advice and go broke despite having a long term profit.

If the RoR calculator tells you your RoR is 1% and you keep spending your profits, your RoR was not 1% to begin with. At least for your dedicated BR. If you just put the money aside to be returned if needed that is a different matter. People talk about RoR to make sure they don't run out of funds. If the winnings are no longer available it is the same as a loss from that perspective. But if you look at RoR as not being behind in the long run more than your initial BR even if you end up with no money to play with because you spent it all than the RoR calculation was right but was a useless metric because now you can't play anymore even though you are ahead $50K but spent that $50K.

True, Tthree, but it all depends on where you set your ROR. $10,000 for a $10 game is a minimum benchmark for a perfect player. You stand to lose your BR even if you reinvest all your winnings. It's a gamble. Every 100 perfect players go bust, much higher for imperfect players. I don't recommend anyone beginning at that level. It's like gambling in order to get to the point where you're not gambling. I'm not a gambler at heart. I hate to lose. If you start out taking this big gamble, what will you do later on when you have adequate bankroll-- probably you'll begin overbetting your bankroll, because that's how you started out in a very real sense. It takes money to make money.

[ohbehave]

That's what I say. So then you should ideally start with much less than a 1%ROR if at all possible. A $50,000 BR is much better than a $25,000 bankroll for playing a $25 game. There is a point where your risk is really minimal, and it's not 4 times your initial bankroll. Ask Don where that is.

True, and there is 0% risk when adding outside funds to the bankroll. If you have to play to build from $25000 to $50000 there will likely be some measurable risk. If you can start with $50k then it may be possible to begin a career with a 0% ROR. That doesn't guarantee it will stay at 0% though, you could have a drawdown significant enough to have a measurable ROR.

A couple great posts on the other site I have referenced time and time again posted by mathboy are cumulative risk of ruin, and effect of overhead on bankroll. Both can be easily referenced by a web search.

The "cumulative risk" article is the one I was referring to in an earlier post. Good article on the subject.

[Three]

Now part of what he means may have to do with beginners not playing a perfect game. If you begin counting cards before you have perfected your routine, your risk skyrockets, but it's not due to a faulty ROR.

Don was talking about what RoR means. His point was it means the chance that you will ever go bust if you play forever. He pointed out that if you go bust it will happen early before the long run or variance has grown your BR. After enough BR growth you will likely have become one of the percentage that isn't going to go bust. If your withdraw strategy has no long run BR growth then you will never grow to the point you are likely a survivor. If you never grow your BR then you are forever in the riskier group that will have a higher attrition rate. In other words the RoR the calculator stated is not the RoR for your method of withdraw of profits. You are always in the more likely to go bust group and your actual RoR would reflect that.

To pull numbers out of my ass. Let's say the RoR calculator shows you have a RoR of 5%. 80% of those that go bust never grow the starting BR significantly and near 100% that go bust never double their starting BR. Almost 95% double their BR and don't go bust despite experiencing the same likelihood of downturn because they can now withstand the downturn without going bust before recovery. A downturn equal to your starting BR has you still out of the red and you have at least your starting BR. If they had taken their profits they would be added to the busted out frequency in RoR almost doubling the chance of going bust. Instead of the calculators 5% RoR the player withdrawing all profits before doubling has a RoR of about 10% from the start.

Unless you think the reason for this metric is to tell you the chances you are ahead when you bust out and can't play anymore you need to look at profits spent in the same way as if you never made the money for the purposes of preserving a playing BR. I am not sure why you would use this metric in any other way than to make sure you have enough capital in your BR to continue playing.

[KJ]

Throughout my career, I have often thought there wasn't enough information available about this topic. What information there is on money management, usually involves bankroll size and different RoR. Very little on drawing money out and such. I guess every situation is different and you learn as you go.

I am not sure the OP's situation, but with a 10k bankroll, assuming he is not playing professionally and has a job or other income source for living expenses, I would let that money accumulate and allow your bankroll to grow. This could allow you to bet higher limits down the road and/or take advantage of other situations as they come up.

Once your bankroll gets to your desired amount for your level of play and you are no longer focused on bankroll growth, I would recommend withdrawing funds at certain set times, but avoiding doing so on a down swing.

In my own case, playing professionally, with bankroll growth no longer an issue, I set my BR at the start of every year to a fixed amount (I use 100K), and don't touch it again, until the end of the year, when I break the bank, divide profit with my partner and reset at 100k for the new year. This initial BR allows us to play at a minimal RoR.

I have a segment of my 'personal funds' that I have designated as a second emergency bankroll, sitting in the bank. In the (hopefully unlikely) event that we experienced a losing year, I would just replenish from that and continue on. In the (even more unlikely) event that we exhausted our initial 100k bankroll during the year, we would continue on and re-set at year's end. Neither of these events, losing initial BR or losing year has really come close to occuring to date (knock wood).

Now, my situation is ideal. I am pretty much where I want to be for the level of play that I want to play and remain playing. But it wasn't long ago that it was a different situation, and I was forced to withdraw living expenses several times during the year. This is where it becomes tricky. If possible, you want to limit these withdraws to periods where you are doing well, at or above expected win. You don't want to withdraw funds during a downswing. Even if you have the bankroll to handle this situation, it is very taxing mentally. It just seems like your BR is hemorrhaging money.

Going back even further, when I first started, I was playing professionally, and that is a real stretch of that word, but BJ play was my only income, and I was extremely underfunded. I had minimal living expenses but needed to take some small amount each month. Being extremely underfunded was a disaster just waiting to happen, but having to take even a small amount of living expenses in any month that had even a small loss, was excruciatingly stressful and dangerous. This is definitely NOT the way to go.

I think mcallister3200 handles it right in separating even a small amount of living expenses (at least several months) to minimize stress. Some will say it's all the same money (and it is), but it just helps mentally. Playing this game, especially for a living can be stressful enough without piling on.

Even if you don't plan on investing everything in your pocket, it's nice to have it with you. What if the advantageous situation presents itself and your pockets are down to nothing while in maxbet territory with lots of rounds left?

I will just say that if you have ever been robbed, your prospective on this first statement changes a little bit. You have to come up with a balanced approach, between "having enough with you" and minimizing risk.

I agree with the second statement completely, there is nothing worse than having to walk from a really +EV situation, due to lack of funds. The few times I have had to do so, were more a product of a poor decision to start that particular segment of play with not enough funds. More a situation where I had experienced a loss for the day and available funds are right at, or just below my threshold to begin another shoe or session and I still tried to squeeze one in.

[mofungoo]

I've been putting 80% of my winnings back into my BR, sometimes more. I've had good bankroll growth doing this, and my blackjack expenses are covered. I am keeping my unit size the same, so my ROR has dropped significantly because of the larger BR. When it gets large enough so that the ROR is a fraction of a percent, I'll start taking a larger percentage of the winnings as profit.