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In Search of Dead Money

EdmondDantes Last night, a friend and I played in an annual, invitation-only tournament sponsored by a national financial services firm. There were 144 entrants (free entry) competing for a prize pool that included a video iPod (3rd prize), a $500 gift certificate at a local steakhouse (2nd prize) and an entry into the WSOP main event and hotel accommodations (a $12,000+ value) for the first place winner.

I busted out about 60th or so when my AQs refused to stand up to my opponent’s K3o, but my friend actually won the event, taking home twelve grand of value for a few hours of work. The quality of play ranged from laughable to abysmal with few players understanding things like hand value, position and blind stealing. Typical for events like this, the blinds increase rapidly—organizers usually want to complete the event in an evening—so you need a certain amount of luck to find your way to the final table. That said, an intermediate player with a decent understanding of poker and tournament fundamentals would have had a huge advantage over the field.

As I was sweating and coaching my friend, it struck me that it may seem a little down market for an aspiring player to compete in these events, but there can be a lot of value in doing so. I'm a big fan of improving my game by playing better players, but I'm an even bigger fan of money. Admittedly, the event above was an invitation-only event (it's good to be on the list!), but there are other pockets of unskilled money out there in charity/invitational events and home games. The prize pools often include non-cash prizes (TVs, gift certificates and the like) but can include, like this one, entries into major tournaments. Novice and intermediate players should definitely keep an eye out for them.

These events are also low risk opportunities to work on basic people reading skills. Very few players in a charity event will sit with the hat and sunglasses ensemble that you see at even low buy-in casino events; of the 144 players in the event we played, none wore sunglasses or a hat of any kind. Novice and intermediate players can use the opportunity to watch the other players for visual clues—their demeanor, how they handle their bets, how they look when put in awkward spot, etc.—and work on matching hand strength to these clues. In a live casino event, other players will be making a conscious effort to conceal their emotions and read yours. In an invitational or charity event, players tend to be less serious and less self-aware so it’s a great opportunity to train yourself to look for tells and try to predict hand strength.

Similarly, I think home games are another source of dead money and opportunity to work on your game. I deal and play regularly in a home game hosted by a friend of mine, and I often bring a friend who is an improving player. We usually play 1 or 2 single table tournaments over the course of an evening. While my friend has a definite edge in live and online tournaments, he has a huge edge in this home game. The other players have poker knowledge (a sharp contrast to charity events) but still make routine mistakes about hand values, position and bubble play. Add alcohol into the mix and you've got a real value opportunity for a thinking player. Doing the math…

Home games = drinking
Drinking = impaired judgment
Unskilled players + impaired judgment = more mistakes
More mistakes = more money

Further, home games are another good opportunity to work on people and hand reading skills. In our home game, I regularly see strong means weak, weak means strong reads, speeches ("Well, I don't like my hand but I guess I should call…") and other basic tells. While I'm dealing, I'm practicing my reading skills and putting guys on ranges of hands based on those reads. It’s surprising how good you can get at it, if you make an effort.

And don’t forget, the vigorish in a home game is a lot less than in a casino event. In our game, we each chip in for food and drinks—there’s no fee to play or expected dealer tip (although there should be…ugh), like there is in a casino. The payout for the players is a lot more efficient than in a live event.

So off-casino event and home games are good spots for an intermediate player to find value. But what about online events? I think online play is usually better than live play at comparable levels, but there is still plenty of, if not obvious, free money. For example, one overlooked source of dead money online is in tournaments with an overlay.

Several online sites offer tournaments with guaranteed prize pools that undersell—not enough people enter to cover the guaranteed prize pool, so the sponsoring site has to make up the difference. The balance is called the “overlay” and is extra prize money spread across the field. For example, a site offering a $50,000 guaranteed prize pool in a $100 buy-in tournament would have to draw at least 500 entrants to cover the prize pool. If they drew only 400, the overlay would be calculated as follows:

400 entrants…400 x $100 = $40,000 of buy-in money

$50,000 guaranteed prize pool - $40,000 entry fees = $10,000 balance added by the site

Therefore, each player would then receive an overlay of $25 ($10,000/400) on his $100 entry, making his $100 worth $125 in this event.

That extra money gets compounded by your skill advantage. If you're 2x as good as the average player in the field, you've got an expectation of $200 for your $100 buy-in. In other words, if you play this tournament multiple times, you can expect to win an average of $200 each time you play. In a tournament with an overlay, your expectation would be 2x the buy-in PLUS the overlay or, in the case above, $250. If you figure the average tournament runs 5-6 hours, that’s an extra $10/hour of value for a good player.

I’ve been tracking the major weekly online tournaments over the last year to see which ones provide overlays. The major PokerStars, Full Tilt and Party tournaments rarely offer them, but the weekly events of many second tier sites, Absolute, Bodog, Pacific and Ultimate Bet, almost always do. Moreover, on holiday weekends, these overlays can be pretty sick—one recent Bodog tournament offered a 90% overlay! You can see the overlays offered in leading tournaments over the last year or so here…

Overlays in online MTTs

To sum up, I’d say there’s a lot of free money out there, if you’re willing to slum it a little in off-casino events, home games and second tier online sites. I’m all for competing against the best, but if your goal is maximizing your dollars per hour of play, keep an eye open for local charity events, find or start a home game and look at some of the guaranteed tournaments offered by second tier sites on that chart. They can be low-risk ways to build your bankroll (or win WSOP entries!), skills and confidence so you’ll be that much stronger in live casino events.

Still digging,



lakeoffire says

Really nice post! I wish it were easier to find home games because I really enjoy them, as long as the people aren't too loaded. It is definately good practice for casino play. Did K3 call your all in?


lakong says

Good post and quite timely for me. I'm playing in a charity tournament on Friday and I'm guessing that the level of competition will be close to what you have described. I would also guess that the majority of the players will think that they are quite good at poker, but we know better. There is just no way for the average home player to approach the level we see at casinos and bigger tournaments without the experience of playing in these situations.

It's my experience that you need to play some very basic and solid poker and get quite lucky in these events because it is difficult to make moves against players who do not want to fold. A typical poke move is based on the assumption that your opponents knows what you are trying to convey. In these events nobody is paying attention. Another issue is that you might read a player correctly -- for example, they seem very weak, but sometimes they don't realize that they are actually pretty strong for the situation. The opposite is also true. You don't think they have anything based on a tell, and it turns out that they didn't think they had anything either, but they actually had a monster!

Now the one thing that I do agree is a great advantage are the obvious tells guys sometimes give off in these tournaments. The most useful one is the 'I don't have anything tell' otherwise known as 'just bet and I'll give up my hand.' You see this one all the time.

Thanks for the great post. I'll be sure to report back on my experience.


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