Variance and Elevators

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23 September 2009, Created By: Ronnie Schwartz
Variance and Elevators
Variance. As poker players we deal with it regularly.

The impact of any card can be favorable or hit us like a devastating blow. It is a powerful force and it lasts a long time, especially when we lose.

Some people control anger internally; others explode externally with verbal and physical releases. It's a matter of demeanor and circumstance. Anger management is as varying as the people who use it.

Common to most, however, is that devastating losses (from a statistical anomaly) are far more memorable in the long run than several positive outcomes which are statistically "expected." Poker is the perfect example to illustrate this.

In a situation where two players are down to the river card and no more betting is to occur (i.e. players are all-in), assume you are a 95% to 5% favourite. If you repeat this hand 100 times, mathematically the underdog should win 5 times.

In the 95 times that your hand holds up, temperaments remain even keel. When, on the other hand, the suck out does occur, things flip. The loser feels like he just got kicked in the ... stomach. Suck outs are called suck outs for a reason: they suck.

When expectations are met we derive minimal amounts of long-term satisfaction. It feels good but the sentiment tends to fade. On the contrary, emotional displacement from unexpected outcomes (statistical anomalies) that are negative have long-lasting impact.

Rare outcomes truly shake us, and since we naturally magnify the negative relative to positive, we find that our memories stay very fresh when it comes to incidences of our own bad luck. The player who loses a 95:5 race will recall the circumstance much more vividly in the long term than the player who sucked out.

Many people live their lives experiencing events from moment to moment believing their emotional response to the day is reactively dependent on what is happening around them (+ve, -ve, neutral). In a poker sense, it is like responding to each occurrence as if it were another card exposed on the board (of life).

Let's view an example. While late for a meeting you rush to the elevator but find that it just began ascending before you got there.

Bad beat. Variance. You become upset. You respond as if you've just seen the one turn card you dreaded seeing. Subsequently your overall disposition leans toward the negative as it would when a bad card hits.

Let's rewind. You are late for a meeting and you run to the elevator. Guess what, it's completely vacant and waiting patiently for its next passenger. Hey, that's you! Your lucky day. Or is it? Not really.

Why? Simply put, it is because this good fortune is not absorbed as such. Instead it is seen as "how it should be".

An elevator is expected to be waiting for us when we need it just as a 95:5 lead is expected to hold on the river.

Instead of taking away a positive and affirming response to this (unnoticed) circumstance, the situation is viewed as neutral.

If something as mundane as waiting on an elevator yields either a neutral or a negative outcome then clearly something is imbalanced. Where is the positive? Where is the appreciation for things that happen as we expect them to?

If a simple daily occurrence either offers us nothing or adds to our irritability then the choices are bad and blah. In this case blah>bad but it still seems like an overall losing proposition. -EV if you ask me.

On the bright side, it doesn't have to be this way. It comes down to choice and effort.

If we choose to view as many things as possible with a proactive mental state (i.e. we consistently monitor our environment and disposition) we will find that eventually our responses to mundane events will become positive>neutral>negative.

Over an extended period of time, with practice and objective observation, the negative tends to diminish in magnitude and the results of our daily routine become positive>neutral.

We learn to view our bad beats and missed elevators as events that are, as mathematical variance shows, purely components of our life's destiny. Learning to deal with things that one cannot control in life, such as variance, leads to a life of understanding and patience.

To appreciate the small victories while eliminating the disdain associated with uncontrollable bad luck is the best medicine for handling life and poker's bad beats.

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Ron Schwartz 2009-10-16 04:47:00

This is interesting to note. It may be that we act this way because of our evolutionary physiology. Here is some interesting info:

________________________________
Early theologians saw pride as the fundamental sin—the “queen of them all,” according to Pope Gregory the Great, who codified the list of seven deadly sins in the sixth century. Indeed, psychologists say that arrogance comes naturally in Western society.

Most of us perceive ourselves as slightly smarter, funnier, more talented, and better-looking than average. These rose-colored glasses are apparently important to mental health, the psychological immune system that protects us from despair.

“Those who see themselves as they truly are—not so funny, a bad driver, overweight—have a greater chance of being diagnosed with clinical depression,” says Julian Paul Keenan, director of the cognitive neuroimaging laboratory and professor of psychology at Montclair State University in New Jersey.

For most of us, it takes less mental energy to puff ourselves up than to think critically about our own abilities. In one recent neuroimaging study by Hidehiko Takahashi of the National Institute of Radiological Sciences in Japan, volunteers who imagined themselves winning a prize or trouncing an opponent showed less activation in brain regions associated with introspection and self-conscious thought than people induced to feel negative emotions such as embarrassment.

We accept positive feedback about ourselves readily, Takahashi says: “Compared with guilt or embarrassment, pride might be processed more automatically.”

MichaelS 2009-09-29 23:56:00

Excellent article! I feel positive and lucky that I saw/read it!

Laylow 2009-09-25 12:50:00

Amaaaaaazing logic, I loved every word of this and will reference it next time I happen to end up that 5%

whiterabbit 2009-09-25 04:21:00

Sorry to hear that Sean, thats completely bogus beacuse 99.9% is 100% according to my math teacher

Vera 2009-09-25 03:42:00

Those beats were you're the over whelming favorite are the toughest and they do stick with you. I can't remember the hands but I do remember going on what seemed at the time (thought it probably wasn't) a streak of getting sucked out on. Get it all in on flop with opponent having 2 outs and getting rivered, maybe next time they had 4 outs. But still with 47 cards unseen and even 4 helping you- that leaves 43 that don't, not exactly odds I'd want to get all in with. And it is like a kick in the stomach. It doesn't bother me near as much as it used to because I know unless I'm 100% to win it is always possible that this may be the time variance hits me upside the head. And going on TILT only hurts you, and actually helps your opponents. If it really upsets me and it's not a tournament then I will watch TV and get away from poker for awhile.

Lenny K 2009-09-24 23:55:00

Sean Lind:

If it happened for $5 you'd barely remember it, or at least you'd barely remember the pain that i'm sure still lingers deep down or in occasional scary dreams...aka nightmares

Sean Lind 2009-09-24 17:17:00

I still remember my first 99.9% to 0.1% loss. It was for far more money than I should ever have been playing heads up for at that time, and I almost lost my head.

I completely broke down, furious with rage that someone went perfect perfect to beat my flopped nut flush with a backdoor straight flush (all in on the flop naturally).

I called a good friend of mine who calmed me down with only one line:

99% is not 100%.

That one line alone was enough to realize that no matter how good your odds are, if you're not 100% you have to lose at some point.

I guess I just wish that loss came when I was fooling around with only $5 on the line. We can't choose when we take the hits, just how we deal with them.

Ed 2009-09-23 23:47:00

I feel all very zen like after reading your post especially after just going all in with J 10 on a
J 7 10 board
to be beat by A9 with turn 6 and river 8 making his straight. Might even print it and paste it to the back of my laptop for any furture bad beat episodes.

Johnpokerspt.blogspot.com 2009-09-23 22:32:00

Very good read, its just in my life the elevator is never waiting, and the 95/5 is a sure loss. thats all keep on trucking doug.

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