Evaluating Decisions Based On Information Available
Posted on Fri 14 January 2022 in Life • 3 min read
When I was in college, online poker was taking off. I distinctly remember Chris Moneymaker winning the World Series of Poker in 2003 after qualifying from a Pokerstars online event. Some friends and I started playing weekly home games and tournaments, and I would watch any airings of WSOP or the World Poker Tour on TV. I played in some free online events whenever I had a few hours.
One of the fascinating things about poker to me is the strategy involved around incomplete information. At first glance, poker seems very heavily luck based, as any card that comes out can cause wild swings in the odds of someone winning the hand. However, after playing for a while, I found that skill was the overriding factor for being a winning player. There's layers to the skill, ranging from determining your odds based on the hand you have all the way to guessing what the opponents have or making the other players guess incorrectly about what you have.
These skills are all based on the fact that poker is a game of incomplete information. Unlike some other games like chess, where you can see the entire board and all pieces and options available to all players, there are things in poker that you don't know until the end of the hand. This means that when you are evaluating your skill and the decisions that you make around betting, calling, or folding, you can't look at the outcome of the hand, you have to look at the decisions in relation to the available information at the time.
An example of this is if you are holding two aces in your hand, and there's another ace on the table in play. You think your opponent has two kings in their hand , but there are no kings currently in play, and there are two cards left to come from the deck. Your opponent goes all in, so you choose to call their bet. It turns out they do have two kings, so you are heavily favored to win the hand. The last two cards come out, and it is a king followed by another king. Even though you ultimately lost the hand, you made all the correct choices based on what you knew at the time. If given the same scenario, every poker player would choose to call, in spite of occasionally losing.
This lesson has stuck with me. Sometimes I catch myself thinking "If I only knew then what I know now...", but I have to stop that thought. Sure, I may have ultimately had a bad outcome from a choice I made, but given the information I knew at the time, was it the correct option? If it was the right choice with imperfect information, then I find I'm able to have less regret about the choice. I may still be upset at the outcome (which happens in poker as well), but knowing that I would make the same choice in that scenario is comforting.
This also helps when thinking about the fairness of life. Sometimes the odds are in your favor to have a desirable outcome, but it still doesn't happen. A 1% chance of a bad thing happening means that it still can happen. It sucks, but on a long enough timeline the 99 other outcomes will happen. The best poker players in the world can lose any given hand, even if they played optimally. Again, this provides a bit of comfort to me. Sometimes you just have to make the best decision you can given the information you have and aim to have a long-term winning record.