Beware Of The Rake! Important Message

So this is a follow up from yesterday's post where I started to talk about the loyalty rewards a little more deeply, and as I followed up with really diving into loyalty programs I came across some information that caused to me to move from 888poker immediately and I wanted to share some light on this matter.

For once as a HUSNG player, I was always aware that rake cuts into your winrate and you should be looking to get the best deals and so on. However, things change once you start diving into the volume aspect of the game. So despite me being a HUSNG player, anybody who is serious about putting in decent amount of volume should pay very close attention to what I have presented below.

First of all, I have been diving into getting good a deal as far as rakeback and loyalty programs could offer. This in a vacuum, kept me from seeing something that I didn't see too well.

Rake: 

We all know the talks about rake, etc. Some of you may be more aware than others (and me) and some may not, but how many of us truly knows how much does rake affects our win rate? I actually took my January results and crunch some numbers up (trying to figure out good loyalty deals for rakeback) but instead got some shocking information about the site I am playing on instead. For one, I anticipated something like this, but never imagined there was such a huge difference.

The first mistake that I made was never paying close attention to the exact amount of rake being raked.

On 888Poker:

$5 HUSNG: $4.55 + $0.45
$10 HUSNG: $9.10 + $0.90

On Full Tilt:

$5 HUSNG: $4.77 + $0.23
$10 HUSNG: $9.45 + $0.45

As you can see, while I knew 888poker was raked higher, I was unaware that it was DOUBLED the amount of the top tier site. This may be because we only hear about rake in the form of % and we really don't dive into the number aspect of things, but keep reading it gets more interesting.

Below are my results from January playing $5 games and $10:

I will be using my $10 games to illustrate a powerful point, but before that the original goal here was to see how much of a difference the rakeback from the loyalty programs of 888poker and Full Tilt would be and how it would affect my winrate. Here is my information:

888Poker 

190 Games: $9.10 + $0.90 = $1,900

Rake: $171.00 (190 Games x $0.90)
Rakeback: $7.70 (4.5% - Silver)

Win: 104 ($1,892.80)

= $1,892.80 - 1,900
= -$7.20 + Rakeback ($7.70)

=$0.50

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Full Tilt

190 Games: $9.45 + $0.45

Rake: $85.50
Rakeback: $8.55

Win: 104 ($1965.6)

= $1965.60 - $1900
= $65.60 + Rakeback ($8.55)

= $74.15

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The Sad Truth is, I haven't even calculated the different levels of the loyalty reward program on Full Tilt and on 888poker you have to climb like 3 other status with a rakeback of 2.5% just to earn Silver's 4.5% Rakeback. The loyalty program of 888poker always bugged me but this might cause me never to want to play on 888poker again, more importantly, this caused me to be 100% more alert about picking different sites I play on.

The overall results:

So here is the thing, I did that for the $10 games, what about the $5 games and my win rate? Well I had to see for myself just how much money I was causing myself. For this, because midway I was earning 2.5% Rakeback under Bronze status then started to earn 4.5% rakeback under Silver, I will just calculate everything under Silver for the sake of the point that I have that (Even though PT4 doesn't show rakeback).

Here is the results:

888Poker:

594 Games: $4.55 + $0.45 = $2,970

Rake: $267.30 (594 Games x $0.45)
Rakeback: $12.03 (Silver - 4.5%)

Win: 349 ($3,175.90)

= 3,175.90 - 2,970
= 205.90 + Rakeback ($12.03)
= $217.93

Full Tilt:

594 Games: $4.77 + $0.23 = $2,970

Rake: $136.62 (594 Games x $0.23)
Rakeback: $13.66 (Bronze - 10%)

Win: 349 ($3,329.46)

= $3,329.46 - $2,970
= $359.46 + Rakeback ($13.66)
= $373.12

ROI w/o Rakeback:

888poker:

$5 Games: 6.93%
$10 Games: -0.38%

Overall: 4.08%

Full Tilt:

$5 Games: 12.10% ROI
$10 Games: 3.45% ROI

Overall: 8.73%

(Note: For those who may not know, to calculate ROI: (Profit/Total Amount Spent) x 100)

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So basically, all this time I been fighting for a 8% - 10% ROI that I see top players been obtaining at the micros and little that I knew, it wasn't me that was the problem (well not entirely me, I still do want to improve) but it was the site I play on that was the problem.

Now of course this doesn't take into account of the competition difference and traffic between the sites but by looking at the data there, the difference is too huge and I rather just study to better than the competition on another site than to play on a softer site where rake dominates the "edge" I thought I would have by playing a softer field.

As of today, I will be on Full Tilt, until I finish check out other sites and more properly too. I will make probably do a report later on for any of you guys who are considering playing any form of SNGs.

For all those players out there, especially playing on other smaller or new sites, make sure you are aware of how rake is affecting your winrate. It might not make a huge difference for those who don't put in no volume and play like once a week, but if you plan to be playing online poker for a little while then consider how rake can affect your numbers in the long run because you can't take back volume you put in and I would hate to see any of my fellow players out there after months of hard work looking at their results like I did, just to figure out you could have made much more for your time only if you had played else where.

For all those players playing cash games or even live poker, it may not be as simple to figure out how much rake is affecting your games like it is for us tournaments players, but it is definitely possible to still figure out so put some time an effort in making sure you truly understand the numbers and do not just assume like I did. Do the research and make sure you are not hurting yourself in the long run.