Who pays the rake?

Who pays the rake?

Hi all,

An argument just broke out in my local poker game about who pays the rake in poker. One side is arguing that only the winner of a hand pays rake, other side is arguing that many people contribute money to the pot, therefore many people pay rake - i.e. the losers of a hand, as well as the winner.

Which is it?

T

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14 December 2023 at 01:27 AM
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59 Replies

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The action is folded around to the small blind. Without looking at their cards, they look towards the player in the big blind, who nods, and makes a chopping gesture with their hand.

But in this casino one dollar is taken out before the flop, from the chips the small blind put out.

Who paid the rake? Both of them?


In this very specific context, it's pretty obvious that the small blind pays the rake.

And in this very specific context, SB is also the loser of the hand, because he lost money out of his own pocket.


In high-stakes games, the house collects a time charge rather than raking the pot. In some games, players prefer to play "time pots," where the time is taken out of the next (sufficiently large) pot.

Suppose the dealer changes, and the cards are dealt. A particular player, outside of the blinds, has a trash hand and folds. The pot turns out to be big enough to collect time from.

Did the player who folded pay any time?


In this more macro context, everyone writes a check to pay for the cost of playing, but a winning player is still paying the cost with someone else’s money.


Consider the following:

One player, Jack, is so good he will win every hand with a $1 bet. There are 8 other players who always call, each losing $1, so Jack wins $8 per hand. 10 hands are played.

Case A: No Rake: Jack wins a total of 10*8=$ 80 and the other 8 players each lose $1

Case B: Rake Game: 50 cents rake is taken out of each pot for a total of $5. Jack wins $80 - 5$ = $75. The other 8 players again each lose $8.

Clearly only the winner, Jack, paid rake

To say that everybody pays the rake is true only if all players are of equal capability. If a player always wins, he pays all the rake. If a player never wins, he never pays rake. Therefore, for each hand the winner pays the rake and since there will always be more than one winner over a set of hands, in this sense, all or most all pay will pay the rake assuming all can win some hands.

However, on average, the better players will pay more rake than lesser capability opponents.


by Tanqueray k

In this more macro context, everyone writes a check to pay for the cost of playing, but a winning player is still paying the cost with someone else’s money.

Yes, in one sense that is true, but as I showed in the above post, the losing players lose the same amount in a raked game as in a no-rake game.


by Tanqueray k

Right, player 1 paid the rake...with player 2's money. So who's actually paying?

By that logic did player 2 also pay for player 1s dinner? Or rent? Or car?

Player 1 pays the rake. Doesn't matter that it was players 2s money before

This isn't really a debatable topic either. I'm surprised this many ppl actually think it is

It's a fundamental concept in poker that when you put money into the pot it is no longer yours


by statmanhal k

Consider the following:

One player, Jack, is so good he will win every hand with a $1 bet. There are 8 other players who always call, each losing $1, so Jack wins $8 per hand. 10 hands are played.

Case A: No Rake: Jack wins a total of 10*8=$ 80 and the other 8 players each lose $1

Case B: Rake Game: 50 cents rake is taken out of each pot for a total of $5. Jack wins $80 - 5$ = $75. The other 8 players again each lose $8.

Clearly only the winner, Jack, paid rake

To say that everybody pays the rake i

Except in reality the players who win the most pots are usually not net winners, because they play too loose.

So then it becomes looser players pay more rake and tighter players pay less which I think is the best (most useful) way to look at it.


by drowski k

By that logic did player 2 also pay for player 1s dinner? Or rent? Or car?

This is why context matters.

by drowski k

Player 1 pays the rake. Doesn't matter that it was players 2s money before

In this very specific hand, player 1 is still not paying for any rake, fee, or whatever you want to call it. Player 2 is paying for it from his stack.

by drowski k

This isn't really a debatable topic either. I'm surprised this many ppl actually think it is

Clearly it isn't, except you can't seem to see it.

by drowski k

It's a fundamental concept in poker that when you put money into the pot it is no longer yours

I put $100 in the pot and I came out with $195.

But somehow I am the one paying for the $5 fee?


by statmanhal k

Yes, in one sense that is true, but as I showed in the above post, the losing players lose the same amount in a raked game as in a no-rake game.

Player A and Player each bring in $100 and get into a HU poker sit'n'go. There is a $10 flat fee to play the game.

There are 3 different rationales as to who's actually "paying":

1. If the money is collected ahead of time, then both people paid for it, because they each gave up $5 to play before the outcome is decided.

2. If the money is collected after the game, winner pays for it, because winner is the only one left with money.

3. Whoever has less money before the occurrence of this event is the one actually paying for it. Winner +$195, loser -$100.

We can argue all day on the perception, but it would seem the most logical that the person with less money is the one end up paying for it.


I'll try to explain in another way.

If we remove all the losers from a player pool in a typical casino raked game, then who's going to pay the rake?

If you can't come up with a scenario that all the winners can all remain winners and still pay for the rake, then I guess it's pretty clear who are the ones paying the rake...


We have clearly established that there are several different ways to look at it, and none are clearly right or wrong. But the only way that seems to be in any way useful in really world games is that looser players pay more rake and tighter players pay less.


It's a really interesting question; btw as an analogy, all the kool kids in Paid Performance Marketing use Shapley Values to do marketing cost attribution. I wonder if one of the PhD economists/mathematicians on this site can weigh in if you could use it here?

However just like in some marketing attribution it may be that it's simply not possible, and while it may be theoretically interesting, but what we're more concerned about is what we do?

In marketing attribution, what we're usually trying to do is work out what the highest ROI marketing spend is and/or where we should increase/decrease our marginal spend.

In the case of poker, the question is how/where should rake effect our play; what actions does it change - ranges, betting sizes, limping strategy, etc.


Eight. months. later...

Everyone pays the rake. It's a tax on the game, collected by the house.

As a percentage of what they win, the best players pay the least rake, and the worst players pay the most.

Whatever the rake percentage is, a good winning player should aim to pay no more than that as a percentage of what they win, and ideally strive to pay less. A bad player is likely oblivious, and will end up paying a much higher percentage.


Can't we just ask the pretend math genius?


by docvail k

Eight. months. later...

Everyone pays the rake. It's a tax on the game, collected by the house.

As a percentage of what they win, the best players pay the least rake, and the worst players pay the most.

Whatever the rake percentage is, a good winning player should aim to pay no more than that as a percentage of what they win, and ideally strive to pay less. A bad player is likely oblivious, and will end up paying a much higher percentage.

Completely missed the statute of limitations... my bad.


by hitchens97 k

Completely missed the statute of limitations... my bad.


You owe me a new laptop. I just spit a drink out all over mine.

Well played, sir.

Well. Played.


by docvail k

Eight. months. later...

Everyone pays the rake. It's a tax on the game, collected by the house.

As a percentage of what they win, the best players pay the least rake, and the worst players pay the most.

Whatever the rake percentage is, a good winning player should aim to pay no more than that as a percentage of what they win, and ideally strive to pay less. A bad player is likely oblivious, and will end up paying a much higher percentage.

How do you come to the conclusion that the best players pay the least rake, and the worst players the most? How are you claiming that the good players achieve this in comparison to the bad players? By taking down more pots preflop, folding more vs 3bets with threshold hands etc? And how can a bad player possibly pay more rake than what the rake percentage is?

Honestly, I don't think many good players are even adjusting their strategy that much more rake considerations.

I think a more informative way to do it would be rake paid in bbs per 100 hands, which I believe would again reveal what we have already established - that loose players pay a lot more on average per hand in rake than tight players.


I think this is more of a semantic issue, and stops being problematic when put into precise mathematical/theoretical terms. I don't think anyone really "pays" the rake in a way that sufficiently meets the full meaning(s) of the word, so everyone's arguing over their favorite shade of meaning or interpretation of the question. There's even a pedantic argument that the person who pays the rake is whoever's white chips the dealer happened to grab, which I haven't seen argued here.

Looking at rake through a mathematical or theoretical framework, you get a clear indication of what you're trying to solve for in a given context.

The winner of a given pot most directly suffers the cost of the rake for that particular hand. This is useful (for example) for answering the question "What would my winrate be if rake didn't exist", which could answer important questions like what games are optimal to play in in the first place.

Most in-game strategic and theoretical considerations assume decisions are made before a winner of the pot is known, and so everyone who is volunteering money into the pot has >0% equity at the point of that decision. Therefore, the cost of the rake is incurred upon each players' EV (in proportion to their equity and realization). This is true whether the players know it or account for it or not. By the way, this not only affects the final size of the pot, but every decision in the hand, including bet sizes, continuing ranges, etc.

From this perspective, saying x player won the pot and therefore paid 100% of the rake is a sort of results orientation akin to saying "x player was going to hit their draw 100% of the time because the dealer had a spade in the hopper", and is equally nonsensical from a strategic/theoretical perspective.

Poker sites have their own incentives when defining "rake contribution"--namely, how much is your behavior on their site contributing to the amount of rake taken from the player pool? This is different from the above, because it's a simple proportion of your contribution of pots and does not account for your equity and realization. So a player who only ever checks or calls is helping increase rake on the site more than they're increasing the actual amount of rake taken from pots won or the amount of EV lost to rake. These players, then, are awarded a greater proportion of rakeback and promotions than the difference between their pre-rake vs post-rake winrate.

I don't see any reason why the site's calculation is any less correct or more dishonest than a player studying rake from the EV perspective. It's just different actors solving for the number that affects their bottom line.


by RaiseAnnounced k

I think this is more of a semantic issue, and stops being problematic when put into precise mathematical/theoretical terms. I don't think anyone really "pays" the rake in a way that sufficiently meets the full meaning(s) of the word, so everyone's arguing over their favorite shade of meaning or interpretation of the question. There's even a pedantic argument that the person who pays the rake is whoever's white chips the dealer happened to grab, which I haven't seen argued here.

Looking at rake th

Excellent answer, thank you.


by Telemakus k

How do you come to the conclusion that the best players pay the least rake, and the worst players the most? How are you claiming that the good players achieve this in comparison to the bad players? By taking down more pots preflop, folding more vs 3bets with threshold hands etc? And how can a bad player possibly pay more rake than what the rake percentage is?

Honestly, I don't think many good players are even adjusting their strategy that much more rake considerations.

I think a more informative

Did you see and read my earlier post?

https://forumserver.twoplustwo.com/showp...

by docvail k

The rake is like the house's edge. Who pays it? Everyone who plays.

Mathematically, the winner of any given pot pays the rake.

Conceptually, the less profitable players in the game end up paying more of the rake than the more profitable players do.

If everyone in the game won an equal number of pots, and each pot was the same size, everyone would pay the same total amount of rake, and there wouldn't be any need to debate.

But in reality, that's not what happens. The winners in the game drag more po

Everyone pays SOME rake (assuming no one wins every pot pre-flop, if there's no pre-flop rake). But the rake doesn't have an equal impact on everyone in the player pool. In order to understand how the rake impacts the player pool, we need to look at rake as a percentage of the money that gets brought into the game, not simply as a percentage of the pot.

If there was no rake, the total amount of money some players win would be exactly equal to the total amount of money other players lose. The average of all players would be break-even in that scenario, as it would be a zero-sum game.

If there's no rake at all, and the the average player would be break-even, then with the rake, the average player is going to lose an amount equal to the rake.

A good player will be able to reduce how much rake they pay AS A PERCENTAGE OF WHAT THEY WIN, whereas a bad player will pay more rake, AS A PERCENTAGE OF WHAT THEY WIN.

This really isn't hard to understand. If I'm playing in a room that only takes rake if there's a flop, I can literally pay no rake whatsoever if I win every pot pre-flop. If the rake is capped, then I can reduce the rake I pay (as a percentage of what I win) by playing fewer pots post-flop, yet bigger pots post-flop.

Take my local room as an example - 1/3 has a 10% rake, capped at $5.

Say I walk in with $500, double up in one pot, and pay $5 in rake, then rack up and leave with $995. I only paid 1% rake. But if I walk in with $500, and win ten $50 pots, I'll pay $50 in rake, or 10%, and leave with $950.

If I stay and lose the $450 in profit, I'll have still paid at least $50 in rake, and I'll have no profit left when I leave, so I'll have paid over 100% rake on my profits, since I have $0 profits.

That $450 I lost? If I lost it all in one hand, the winner paid $5 in rake. If I lost it in 9 pots for $50 each, the winners paid $45 in rake.

Even though I "broke even" when I came with $500 and left with $500, I really didn't, because I still paid at least $50 in rake. If there was no rake, I'd have at least $50 profit on my way home. Truly "breaking even" would be leaving with $50 less than I had when I walked in, if the rake is 10%.

A really bad player is going to lose a lot of pots, with that money going to their opponents, and some to the house as rake. But the really bad player will also pay a lot of rake on the small pots they win, with that money just going to the house.

Think about the guy who comes to the room with $2k, wins a bunch of smallish pots, but ultimately loses the whole $2k. He's paying a $hlt-ton of rake.

Worse players will pay a higher rake (as a %), and better players will pay less (as a %). The very best players will beat the rake by a larger margin than players who are merely good.

The amount of rake someone pays can range from 0% (win every pot pre-flop) to 100% (pay all your profits to the house, as rake), no matter what the rake is.

Better players end up paying less rake. Worse players end up paying more rake.


by RaiseAnnounced k

I think this is more of a semantic issue, and stops being problematic when put into precise mathematical/theoretical terms. I don't think anyone really "pays" the rake in a way that sufficiently meets the full meaning(s) of the word, so everyone's arguing over their favorite shade of meaning or interpretation of the question. There's even a pedantic argument that the person who pays the rake is whoever's white chips the dealer happened to grab, which I haven't seen argued here.

Looking at rake th

By far and away the best answer so far.


by docvail k

Did you see and read my earlier post?

https://forumserver.twoplustwo.com/showp...

Everyone pays SOME rake (assuming no one wins every pot pre-flop, if there's no pre-flop rake). But the rake doesn't have an equal impact on everyone in the player pool. In order to understand how the rake impacts the player pool, we need to look at rake as a percentage of the money that gets brought into the game, not simply as a percentage of the pot.

If there was no rake, the total amoun

I still don't think you have satisfactorily explained how less profitable players are paying more in rake than more profitable players - the key point in that regard being that it's the winners in the game who pay the rake. The bad players are losing money to the good players, who in turn are paying rake on the pots they win.

Yes, agreed that players who win a small amount of larger pots will pay less proportionate rake to their winnings than players who win a large amount of smaller pots. But that fact is academic in that there is no way for a player to try and force all the pots he wins to be large ones, or to try and win as many pots preflop as possible in order to avoid rake. It would be nice to do that, and those facts can certainly influence and inform our play to some small degree, but in reality poker just doesn't work that way. Often it's correct to go postflop, and often (probably more often than not) it's correct to play a smaller pot with larger proportional rake (given that the average hand strength on the river usually doesn't warrant a massive pot being played).

I think the pertinent fact here is that the rake is paid by the winners of the game.


by Telemakus k

I still don't think you have satisfactorily explained how less profitable players are paying more in rake than more profitable players - the key point in that regard being that it's the winners in the game who pay the rake. The bad players are losing money to the good players, who in turn are paying rake on the pots they win.

Yes, agreed that players who win a small amount of larger pots will pay less proportionate rake to their winnings than players who win a large amount of smaller pots. But th

Let me try this one last time.

If the rake is taken from the pot, post-flop, then the winner of each pot pays the rake for that pot.

Everyone pays SOME rake, except for the unlikely possibility that some player is able to win every hand pre-flop, and thus pay no rake.

But winning a pot, even winning multiple pots, doesn't make someone a winning player. It's possible to win lots of pots and still lose money. Someone can win a lot of small pots, and pay a bunch of rake, and then lose their entire stack in one large pot. Being a "winner" is about taking money out of the card room, not winning lots of pots.

The rake is usually a fixed percentage of the pot, capped at a certain amount. Nominally (in name only), it may be 10% of the pot, up to a cap of $5. But that doesn't mean everyone is paying 10%.

The player who wins every pot pre-flop pays no rake at all (0%). The player who wins one $500 pot and pays $5 in rake before racking up and leaving pays 1%. The player who wins ten $50 pots and pays $50 in rake pays 10%.

But that analysis only looks at the pots WON. It doesn't look at the pots LOST. As players, we don't look at how many pots we win or lose. We care more about how big those pots were, but even that isn't the metric which matters most. We measure our wins and losses over time to come up with an hourly rate, which we're trying to maximize.

In order to maximize our hourly rate, one of the first goals should be minimizing the amount of rake we pay, by winning more pots pre-flop, trying to make the pots we win post-flop bigger, and keep the pots we lose smaller (minimizing our losses, with the positive side-effect of forcing opponents to pay more rake than we do).

That doesn't mean we shovel money into every pot we play post-flop, regardless of our hand strength. We should try to match the size of the pot to the strength of our hand. But in order to get to post-flop, we first need to play pre-flop, where hand selection and our pre-flop strat is going to have an impact on our ability to play fewer small pots and more big pots.

We can massage the pot size whether it's a "big" pot or a "small" pot, by finding ways to get incrementally more value with our bet sizes. If we were to increase all our value bet sizes by 5%, and / or decrease our bluff sizes by 5%, that would have a massive impact on our hourly rate, and help us pay less rake (as a % of what we win). Better players are constantly trying to find the most efficient bet sizes.

There are some games that aren't even worth playing, because the rake is too high. Winning players understand the value of game selection, to include rake considerations, and choose to play in games with less rake, if it's an option. If winning players favor games with lower rake, they understand the impact rake has, and will be looking to minimize that impact on their win rate with how they play.

Can even the best players get down to only paying 1% rake? Probably not. But they strive to minimize the impact of rake on their win rate. The worst players aren't even thinking about rake considerations, and are therefore more likely to pay a lot more rake, because they're not deliberately trying to win more pots pre-flop, and they're not constantly looking for spots to bet bigger with value.

The worse a player is, the higher the impact rake will have on their win rate. The better a player is, the lower the impact rake will have on their win rate. It's not about every player paying rake when they win a pot, it's about how much rake each player pays as a percentage of the total amount won over a lifetime of playing.


What I can't figure out is: Why someone would ask a question when they are already unshakably certain of the answer?

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