Tournament Fees and the Rake

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Your principal playing expenses in poker are the very chips you're wagering and the money that they represent. That's why it's called gambling. There are, however, some additional expenses associated with playing poker in any kind of organized setting, whether in a casino, an independent cardroom, or at an online poker site.

Some of the online-specific expenses have already been covered, such as the transaction fees and other costs associated with establishing a real-money poker account. Add to these a couple of traditional poker-playing expenses that have migrated from the real world to the virtual realm: tournament fees and the rake.

You've learned already that online cardrooms do not make their money by accepting wagers from players. Instead, their profits depend on charging a fee to all players for facilitating the games themselves. These fees come in two varieties, the first of which is known as the rake (or sometimes the table rake or the pot rake).

The rake is the amount of money that is collected by the house from each cash game pot (see figure). Each online poker room has different policies here, but they are stated up front and in fact are pretty similar. A typical rake is five percent of the pot, rounded to the nearest $.25, up to $3 per pot. Many online poker rooms have carefully calibrated rake charts that take into account the betting limits and the number of players in the game.The rake is often reduced when there are fewer players at the table; at some micro-limit games, there is no rake at all.

This money is automatically taken from every pot generated in a cash game. So, for instance, in a $3/$6 limit game with a five percent rake and a $40 average pot, the house collects $2 from each hand dealt. In many cases, the house simply deducts the rake when the pot reaches a certain threshold. When the pot reaches $20, one dollar is dropped and taken as the rake fee. At $40, another dollar is dropped.

In this example, then, assuming there are 10 players in the game, the rake is costing each player about 20 cents per hand. Let's say the game is averaging 40 hands per hour. That means it's costing you about $8 per hour to sit there and play. Many complicated and charming mathematical theories proceed from here, regarding whether it is even possible to "beat the rake" at low-limit poker games.

The good news is that rake policies at online poker sites tend to be lower than those in casino cardrooms. Also, there's a tradition in casino cardrooms (more of an unspoken policy, really) of tipping, or toking, the dealer when you win a pot. In the online rooms, of course, that's not an issue.

Tournament fees are more simple and straightforward. Rather than raking the pot, the cardroom simply charges every player in the tournament a flat fee for participating. The emerging industry standard is 10 percent of the buy-in for lower stakes events. So in a $10 tournament, you pay a $1 fee. The $10 goes to the prize pool; the $1 goes to the house. This is usually indicated as $10/1 or $10+$1.

For larger buy-in events, the fee is usually a little smaller: $100/9 or $200/15. One thing to note is that in sit-and-go tournaments, your buy-in and tournament fee are refunded to you if you choose to leave the table before play begins. In instances where the poker site itself goes offline during tournament play, all monies are refunded so long as you are still at the table.