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Poker: A Game of Chance or a Game of Skill?

Poker: Chance or Skill

The answer’s obvious to anyone, that knows anything, about poker.

But there’s no definitive answer on a federal level.

That’s a problem because it’s preventing us from legally playing poker online. Instead, it’s up to each state to decide what we’re allowed to do. At that point it becomes a personal decision, and not one based on facts.

So, why don’t we have a definitive answer? Why can’t we simply state that poker is a game of skill? We believe there are two reasons, or rather two problems standing in our way:

  • No one’s decided any parameters to measure or compare poker to. The result is that every study or experiment that comes out is subject to having holes poked in it.
  • Few people outside the poker or stats community truly understands odds or variance. So, words like ‘luck’ and ‘chance’ get thrown around as if poker was no different than slots.

These two problems need to be addressed, we think, before we can declare poker a game of skill and move on from this silly debate.

Or, we can go with our alternative solution. An easy and simple way to help everyone see poker for the game of skill it is.

We’ll talk more about that in a minute. But first we want to dive into each of the two problems in more detail.

Problem #1: Undefined Variables = Flawed Experiments & Studies

The first problem is important to solve because we have two groups of people – poker is a game of skill and poker is a game of chance – conducting experiments and studies to prove their cases.

But how do we know when they’re right? How do we know when they’re wrong?

We don’t …and we won’t until some baseline parameters are established.

We’re going to give you an analogy so you can see how big a problem this is. But first, let’s look at a few studies that have been done in attempt to prove poker is a game of luck or skill.

Is 60 Hands Really Enough?

This study involved 300 people. They were divided into 2 groups – one ‘expert’ and the other ‘non-expert’ – which was based on whether they had any interest in poker.

Then they played 60 FIXED hands of Texas Holdem. They were fixed so that players could get a consistent range of good and bad hands. The researchers concluded that poker isn’t as much a game of skill as people think.

Their reason?

Because the ‘experts’ didn’t win that much more money than the ‘non-experts’ did.

But there are a few problems with this study.

One, FIXED hands? Really? It’s sort of hard to get good data when you’re not recreating what it’s actually like to play poker ‘in the wild’.

Two, only 60 poker hands? Any poker player (let alone statistician) will tell you that you can’t come to any conclusion after only 60 hands. A LOT can happen in such a small sample size.

You need more volume. But, herein lies the problem.

How much volume do you need? Is it one hand? Is it 60 hands? 5,000 hands? Do we go until we reach statistical significance?

How Many Hands Until You Can Call Yourself a Winner?

For this next study they went the opposite direction.

They analyzed more than 100 million hands.

Their data pointed out two things:

  • Three-quarters of all hands never go to showdown.

  • Only about twelve percent of hands are actually won by the best hand.

From a ‘poker is a game of skill’ point of view, these findings are huge. Here’s why:

It totally obliterates the argument from the other side that poker is (predominately) a game of chance because the cards are dealt to each person at random. That since some people are dealt better hands than others, they have a better chance of winning.

It’d be a great argument too, if it weren’t for the two flaws in their study:

  • They found that their winners are winners after only having played 1,000 hands (about 15-30 hours).

    Any reasonable poker player will tell you that 1,000 hands tells you nothing. That could be just one bad or good day at the office.

  • Their data has a large amount of players who logged in, played 100 hands, lost their money, and then never logged in again.

As one researcher put it, “No serious player can win as fast as a highly unskilled player can lose.”

The problem here is all that dead money can prop up slightly losing or breakeven players to winning player status.

This wouldn’t be a problem if we determined what a winner is. The qualities or accomplishments that makes up a winning poker player.

Even then, would that be enough?

All Poker Winners Share These Same 6 Traits?

This study analyzed the 2010 WSOP.

What they found is that the previously determined ‘skilled’ players achieved an average 30% ROI compared to -15% ROI for everyone else. The skilled players earned an average of $1,200 per event, where the others lost an average -$400 per event.

Score one for the ‘poker is a game of skill’ camp …right?

We don’t think so. Let us tell you why.

They determined that skilled players were based on pro rankings, Bluff rankings, WPT winners, top money earners and bracelet winners.

Sounds good in theory. But here’s the problem (according to them):

“It is not immediately obvious how one measures the importance of skill versus luck in poker relative to other activities. One approach that problem is to estimate the probability that a randomly drawn high skill poker player will outperform a randomly drawn low-skilled poker player over the course of a tournament. An important limitation of our data in this regard is that we do not observe the complete order of finish, but rather, only the order of finish for those who make the money. Because of this limitation, we can make pairwise comparisons between two players in a tournament only when at least one makes the money.”

So, they didn’t look at everyone – but only those that finished in the money.

What if their “successful” poker pros had a bad series? What if a couple “unsuccessful” players won a couple (HUGE) events?

It’d skew the data.

I see what they were trying to do – show you that successful players win more than those that lose. But their study was flawed; not only for the reasons they mention, but also because they tried to determine what a winning poker player looks like.

It’s relative. It’s an opinion at best.

We need something more definitive. Something more concrete.

But what?

Mini Conclusion to Problem #1

We need to define some parameters to measure or compare poker to. And if defining parameters doesn’t sound important to you, think about it like this:

Say we removed the speed limit. You can drive as fast or as slow as you want. But the police can still hand out tickets for speeding, or in extreme cases, for not going fast enough.

So, how fast is too fast? How slow is too slow? How do you know?

You don’t, because there are no parameters or guidelines to follow. The answer then is one based on opinion (the police officer’s) instead of one based on fact (the law).

We don’t know what those parameters should look like. But we do know that they need to consider volume and statistical relevance, as that’s the only data that won’t be skewed by short term variance.

The thing everyone confuses as “luck”.

Problem #2: People Don’t Understand Variance or Gambling Odds

The second problem is how we define skill or luck. Most people confuse luck with odds or variance. They don’t get how all that works.

Here’s a quick definition of variance:

Variance is what the short term fluctuations in any game of chance are called. For example, in poker you may have a 60% chance to win, but that also means you have a 40% chance of losing.

This changes at each stage of the hand. Every time someone calls, folds or whenever a new card or hand is dealt, these numbers change.

The problem is that many people don’t think about luck or variance when they win. Hell, they probably don’t give it much thought when they’re on the winning end of a bad beat.

But if they lose with their pocket aces, lose with their aces a few times in a row, or someone makes an inside straight draw against them, it’s because that person got “lucky”.

It’s not luck, though – it’s variance.

You’re just not going to win every time. Every hand or situation has odds that tell you how often you’re going to win …and how often you’re going to lose.

And the more hands you play, the more you’re going to see (and hear about) these “lucky” hands.

For example:

How many royal flushes have you seen?

We’ve seen at least 5, give or take a few, in our lifetime.

Most people would chalk it up to luck. It’s rare, this royal flush. But it’s not luck, it’s variance. The odds of hitting a royal flush is 1 in 650,000 hands.

Playing live, you might see a royal flush once or twice per year.

So when people see 2 in one day online, they swear its luck. Or, maybe even a rigged system!?

But the truth is, online, there are dozens – maybe even hundreds – of poker tables open. Each one is dealing 50-100+ hands per hour. Each site probably deals thousands, maybe even tens of thousands of hands each day.

With so many hands being dealt, these ‘rare’ or odd hands are bound to happen far more than they would live (where you might see hundreds of hands per day, not thousands).

And because we’re going through so many hands, so fast, we’re going to see more of these ‘odd’ things happen simply because we’re due for them. The odds say we should.

In other words, say you saw 650,000 hands per day. Would you find it odd, then, if you were to see 1 royal flush per day?

No way. It’d be perfectly normal.

In fact, since odds/variance don’t work in a perfectly scheduled way (you only see 1 royal flush per 650,000 hands dealt), it’d be perfectly reasonable to see several royal flushes on any given day.

It’s bound to happen. Because it’s variance, not anything to do with “luck” or “chance”.

Mini Conclusion to Problem #2: How Do We Define Luck Anyway?

After the last couple of sections, you could argue that we need to define what luck is. But that’s impossible. For example, there are odds of hitting the lottery. It’s something like 18 million to 1.

Is it impossible?No.

But it IS a long shot. A far longer shot than any poker hand or situation.

Most people would call you lucky for winning the lottery. But are you still lucky if you win a scratch ticket at odds of 1 in 20? 1 in 100? 1 in 500?

Some people might call you lucky. But most, we think, would just say the odds were in your favor. You were due. It was bound to happen. And, ironically, we’re talking about the truest form of gambling – not a skill game like poker.

But because luck (and, apparently gambling) is relative, it’s not something we can rely on to determine the answer to the “is poker a game of skill or chance” argument. Like determining what makes a winning poker player, there’s too much opinion and not enough fact.

The Solution: Define Skill

The solution is simple: Define what skill is; what it means to be skilled at something.

You can compare that list to any example, any story, any analogy, and it would hold up.

Our Story

We played poker for a couple years before we hired a coach. We were pretty good. Not profitable, but we could hold our own.

Then we hired a coach and leveled up our skills. Can you see where it all turned around?

Our Total Profit Chart

We learned how to (properly) play 18-man sit and go’s. We learned what hands we should play, when and from what position.

We learned why you need to shove with 10 big blinds or less. And we learned what types of hands to shove, when, from what position and what to shove against certain opponents and stack sizes.

These are skills we learned that helped us go from a broke poker player to a profitable poker player. And it was clearly a skillset that not every one of our opponents shared, because there were lots of them that played hundreds or thousands of games, but were losers overall.

Our coaches – and many of our friends – still play today. They make their living from it.

But they could only do it after learning and honing a specific skill set – not only to play poker, but a specific poker game and variation.

Sort of like being athletic, but building and honing your skills for a specific sport.

Like basketball.

Shooting Free Throws with Lebron

Here’s an analogy for you.

Say you were to take us, a not-so-skilled basketball player. And we wanted to go head-to-head with Lebron James in a free-throwing contest.

(Arguably one of the best basketball players today …and of all time.)

The contest is simple: Whoever makes the most baskets wins. The catch?

You only get 20 shots.

We go first and make 18 of 20 baskets. But Lebron only hits 10.

Was he sick? Did he have a bad morning? Was he not warmed up? Was he in total awe after watching us shoot?

Maybe. But we doubt it.

If you think back to what we said earlier, 20 shots is nothing. It’s too small a sample. Especially when you consider that over Lebron’s career, he’s made 74% of his 8,000 attempted free throw shots.

You have to take a much longer sample size.

If we were to go head-to-head for 8,000 buckets, no doubt Lebron would beat us. Never mind talent – he’d beat me simply because he’s put in so much time and effort into developing his skills.

It’s only because of that he’d outperform us in the long run, over the course of a career, which is all that should matter anyway.

Anyone can have a bad session or a bad game. But the true professionals – those that have developed their skills – will always outperform the unskilled in the long run.

The Same Applies to Chess

We don’t think anyone would argue whether chess is a game of skill. A random person would almost never beat a grandmaster. But what if you were to introduce a die?

Each time, after someone wins, the person who won would toss the die. And, whenever it landed on 1, the other player would actually be declared the winner.

Basically we introduce an element of luck.

It wouldn’t make a difference, though. You know why?

The skilled player – the grandmaster who’s likely to win 100% of the time – will get robbed 1/6 times. But he’ll still win the other 5/6 times.

And it may take a while to see it. Because he might roll a 1 a few times in a row. Over a short term the data might show the other (unskilled) player’s better.

But if you look at the data over the long run, the better player, the more skilled player, will always, ALWAYS, come out on top. No matter how much “luck” a game appears to have.

This is true of any sport or game, including poker.

There’s a reason why you see the same 40-50 players taking down pot after pot, or tournament after tournament, despite the larger fields. Why the same players are always adding to their bank balance instead of taking from it.

It’s because poker is a game of skill, and the best players in the world have developed the skills needed to compete. Just like Lebron James. And just like the chess grandmaster.

Okay, So How Do We Define Skill?

This is hard to do, but we think the state of Georgia does a good job of it. They define having (some) skills as having all, or any combination of the following traits:

  • A learned power of doing a thing competently;
  • A particular craft, art, ability, strategy, or tactic;
  • A developed or acquired aptitude or ability;
  • A coordinated set of actions, including, but not limited to, eye-hand coordination;
  • Dexterity, fluency, or coordination in the execution of learned physical or mental tasks or both;
  • Technical proficiency or expertise;
  • Development or implementation of strategy or tactics in order to achieve a goal; or
  • Knowledge of the means or methods of accomplishing a task.

This fits any successful, winning and skilled poker player pretty well, we think.

But, ironically, Georgia doesn’t think so because the “time frame over which the elements that constitute skill in poker work to allow the more skilled players to ‘obtain more frequent rewards’ is both uncertain and too lengthy.”

So, again, we come back to needing volume and statistical relevance. To needing guidelines to measure our (poker) data against. And, we’d need enough of it to get through the foggy haze of “luck” which is really only variance (aka everything’s bound to happen at some point).

But, a much simpler solution is to use the statute above and define what it means to be skilled.

We think if anyone were to do this, they’d easily see poker for the game of skill that it is, leaving us to stop this circle jerk of an argument and get to more important matters.

Like legalizing online poker.

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