Cashout Hold'Em Tournaments
Buy-in is of the standard variety, say $10 + $1, with $10 going into the prize pool and the "+ $1" going into the casino's pocket.
The prize pool is then split in half, such that half goes toward the normal prize pool that pays percentages based on order of finish, and the other half goes into a "cashout" pool.
At any time after the first few rounds, a player has an option to cash out all or some of his chips for half of their original value at the start of the tournament. For example, a tournament that starts with 100 chips per player and costs $10 to enter would pay $0.05 per chip if you cashed out. You may cash out chips in 10% increments of the original stack size, up to whatever you have in front of you at the time. Thus, in the example above you could go in 10 chip increments. Chips that are cashed out are removed from play.
When (if ever) would cashing out have a positive EV?
Quote: scudderThe site where I play online poker (Full Tilt Poker) has started offering "cashout" poker tournaments, and I was wondering if the Wizard or someone else with math skills far superior to mine could give me some guidelines on an optimal strategy. The tournament is structured as follows:
Buy-in is of the standard variety, say $10 + $1, with $10 going into the prize pool and the "+ $1" going into the casino's pocket.
The prize pool is then split in half, such that half goes toward the normal prize pool that pays percentages based on order of finish, and the other half goes into a "cashout" pool.
At any time after the first few rounds, a player has an option to cash out all or some of his chips for half of their original value at the start of the tournament. For example, a tournament that starts with 100 chips per player and costs $10 to enter would pay $0.05 per chip if you cashed out. You may cash out chips in 10% increments of the original stack size, up to whatever you have in front of you at the time. Thus, in the example above you could go in 10 chip increments. Chips that are cashed out are removed from play.
When (if ever) would cashing out have a positive EV?
Short answer: never.
A chip will always be worth total prize pool/number of chips in play. Cashing out for half that amount is obviously tossing half that value out the window. This would be true no matter how many chips you had.
Quote: mkl654321A chip will always be worth total prize pool/number of chips in play. Cashing out for half that amount is obviously tossing half that value out the window. This would be true no matter how many chips you had.
That is only true in winner take all tournaments where your prize equity is directly proportional to your chips. In multi-place tournaments such as these each additional chip is worth slightly less than the ones you already hold.
Unmentioned in the original post is that the cashout pool is divided proportionally by chip count once the final table starts, which discourages cashing out during the bubble. For example, if you had 70% of the chips in play with ten players remaining you would be insane to reduce your stack at all because you'll recieve the full cashout value of your chips without forfiting them at the next elimination.
Still, never cashing out is a reasonable strategy since the correct times to cash out are pretty marginal. One example being a tiny stack in the money but far from the final table. If you're dead last in 20th place with no reasonable chance of moving up the money list then you'd be better off taking 20th place money plus your cash.
Since at that point, unless you suddenly get unlucky or start playing stupid, you're likely to go deep into the final table, which eliminates the positive EV.
The only time the cashout should be used is as intended: If something comes up and you can't finish the game.
Quote: scudderThe site where I play online poker (Full Tilt Poker) has started offering "cashout" poker tournaments, and I was wondering if the Wizard or someone else with math skills far superior to mine could give me some guidelines on an optimal strategy. The tournament is structured as follows:
Buy-in is of the standard variety, say $10 + $1, with $10 going into the prize pool and the "+ $1" going into the casino's pocket.
The prize pool is then split in half, such that half goes toward the normal prize pool that pays percentages based on order of finish, and the other half goes into a "cashout" pool.
At any time after the first few rounds, a player has an option to cash out all or some of his chips for half of their original value at the start of the tournament. For example, a tournament that starts with 100 chips per player and costs $10 to enter would pay $0.05 per chip if you cashed out. You may cash out chips in 10% increments of the original stack size, up to whatever you have in front of you at the time. Thus, in the example above you could go in 10 chip increments. Chips that are cashed out are removed from play.
When (if ever) would cashing out have a positive EV?
There is at least one very specific case where this is beneficial. If one player is a prohibitive chip leader at the final table(s), sometimes the other in-the-money players will just let the system auto-fold them and move on to other tables. In that one specific case, it makes sense for the leader to cash in some of his/her chips. It really is possible to have your cake and eat it too.
Quote:Players will be able to cash out until the tournament reaches the final table, at which time the Cashout period will end. When the period ends, all money left in the Cashout pool is divided between the remaining players based on the current Cashout value of their chip stacks.
This is why I said you would be insane to cash out part of a large stack. You will be awarded the cashout value of your chips when you make the final table anyway. So your options are:
1. Cashout - recieve the cashout value of your chips, play the final table with a reduced stack.
2. Don't - recieve the cashout value of your chips when the final table starts, play the final table with a huge stack.
There is one clear-cut opportunity which is easy to detect in practice, when your tournament equity slips below the value of your time. Suppose the starting chip stack is X, cashing out 2X will break even on the buyin. Suppose in the middle rounds, out of the money, you have 30X chips. You take a bad beat against a 20X stack which leaves you at 10X and a greatly reduced chance of winning. You may very well cash out here even if it's less than your chips are worth because you can make a larger amount in another event or in a cash game. If you can cashout $10 when your stack is worth $15 you only need to make $5 in a different game before the tournament ends.
Personally, I could see using a "reverse rebuy" strategy as well. In huge fields (10k players) it's not uncommon to get past the first break or two with a healthy stack, while a bunch of maniacs have absolutely mammoth stacks. Then you're probably going to profit since 2k places pay, but unlikely to make the final table which is all that pays really well. You could buy out and lock in a smaller profit, even if you're taking the worst of it. The idea being not that you could make more elsewhere, but that you're looking for the big score.
