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RakeBack
Articles
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How
Bonuses Effect Rakeback
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A common area of confusion for
on-line poker players who receive rakeback, or are
thinking about signing up for rakeback, is the effect that
bonuses have on the amount of rakeback that the player
will earn. Though different poker rooms have different
policies, for the most part they all include bonuses in
the same manner when calculating the revenue a player has
created. There is a smaller rakeback payment because of a
bonus that the poker room gives the poker player, but this
payment, combined with the bonus, is always more than just
the bonus or just the rakeback. The following will explain
why a player wants to utilize rakeback and bonuses in
order to increase their win-rate, and in effect, their
bankroll.
Understanding how rakeback is calculated is not necessary
in order to know the effect of bonuses on rakeback, but it
would greatly increase the player's understanding of
rakeback and, even, poker in general. An explanation of
MGR (Monthly Gross Rake) and rakeback can be found in the
article "How On-line
Poker Rooms Calculate Rakeback." For our purposes
here, if the reader understands that MGR is pretty much
the 'revenue' the poker rooms consider a player to have
contributed in rake and knows that the refund they
receive, aka 'rakeback', is a certain percentage of their
MGR, then the rest of this article will make sense (If
not, reading the article mentioned above beforehand would
be a good idea). The average percentage of rakeback
offered is 35% and, for our purposes here, will be the
percentage used.
The formula: ($MGR - $Bonus)*(RB%) = $RBPAY (where
"$Bonus" is the bonus in dollars received from
the poker room by the player, "RB%" is the
percent of rakeback earned by the player, and
"$RBPAY" is the dollar amount the player will
receive) is a simple method that can be used to calculate
rakeback for a given month.
If a player receives a $100 bonus from poker room A, has a
MGR of $1300 at the poker room, and receives 35% rakeback,
we can plug these numbers in the above formula, ($1300
- $100)*(.35), and see that the amount the player will
earn in rakeback is $420. After the bonus is deducted from
the MGR, the player's net MGR is $1200 ($1300-$100) and
then her net MGR is multiplied by 35% ($1200 * .35) to
receive the total rakeback payment she will earn. If she
didn't take advantage of the bonus, her total rakeback
payment would be $455 (the formula can still be used:
($1300-0)* (.35) = $455). Granted, her rakeback payment is
$35 more than if she had received the bonus and rakeback,
but she has actually earned $65 less (her total net earned
from bonuses and rakeback, when a bonus is received, is
$520) than if she had taken the bonus and rakeback. A
player should never turn down a bonus because of
rakeback and never turn down rakeback because of a bonus.
The bonus and rakeback should always be taken
advantage of.
If a player, as another and final example, earned $600
bonuses and $2000 in MGR, what would her rakeback payment
be?: ($2000 - $600) * (.35) = ($1400) * (.35%) = $490 ;
Her total rakeback and bonus would be $1090, which is more
than double what it would be without rakeback (she would
just earn the $600 bonus) and $390 more than if she
didn't't take advantage of the bonus ($700 with only
rakeback and no bonus). Clearly rakeback and a bonus is
the best situation and offers the most positive expected
value for the on-line poker player.
As a final note, not all sites deduct bonuses from MGR,
but subtracting the bonus from MGR is the industry norm.
Hopefully, in the near future, there will be a switch from
this, but the present state of bonuses and rakeback is
more than satisfactory to help increase the poker player's
bankroll and win-rate.
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