Explanation of Variance
Poker is a long term game. Although winning over a big sample is completely possible with sufficient skill, big ups and downs should be expected over the short term. These ups and downs are colloquially referred to as “variance”.
Many players don’t realise how significant the impact of variance is. For example, many are shocked to learn that a 6bb/100 cash game winner could potentially end up losing money over 100,000 hands. Although this is relatively unlikely, it’s only a matter of time before a player experiences such a bad run if he puts in a lot of volume.
Conversely, it’s also possible for a losing player to actually profit over 100,000 hands of poker. Some have even left their day job as a result of large initial profits, only to find that they have no hope of making consistent money unless they seriously improve their skillset.
There are “variance calculators/simulators” online that help us to calculate best and worst possible runs given a certain winrate, standard deviation and number of simulations. (Note that standard deviation can usually be obtained from poker tracking software.)
Example of Variance used in a sentence -> Some types of poker games entail more variance than others.
How to Use Variance as Part of Your Poker Strategy
Let’s extrapolate two key principles from the above discussion on variance.
1. Results in the short term can be misleading and should not be relied upon. Anyone can run good over 20,000 hands – a big winning graph over such samples constitutes zero proof that such a player is decent, or even winning in general.
2. Even very good players will go on big downswings and long break-even stretches. It’s hence very important to develop a strong mental disposition to help us get through the variance. For more information on this topic check out the glossary entry under mindset.