In simple language it is basically keeping to the the limits that your bankroll allows
Say for example you had $100 on Poker Stars. Playing a $0.25/$0.50 cash game would
not be good bankroll management because you will not win enough to prevent you going
bankrupt when the inevitable bad run of cards comes.
Bankroll management is one of, if not the, most important factors of becoming a winning
poker player. Many players under estimate the importance and then end up bankrupt.
The majority will never understand and will continue to lose their money. But that’s
OK right? As that is one of the areas where our profit comes from.
HOW DOES BRM WORK?
It is usually recommended that you only stake a maximum of 5% of your entire bankroll
in any one game. So if your bankroll was at $100, you should be playing cash games
with a maximum buy-in of $5 as that is obviously 5%. If you grew your bankroll to
$200 then you could move up to the next limit with a maximum buy-in of $10, as again,
that is 5% of your entire bankroll. On the other hand, if you were to lose $50 then
you would be exceeding 10% and should, therefore, swallow your pride and drop down
a level until you have rebuilt your bankroll.
WHAT LIMITS SHOULD WE PLAY AT?
PL & NL Hold'em
If you are playing PL or NL poker, the recommended size of your bankroll is 20 times
the maximum buy-in of the limit that you want to play. This means that if you want
to have the best chance of making money at a $0.50/$1 cash game which would have
a typical buy-in of $100, you should have a bankroll of at least $2000.
Another way of applying bankroll management is by only putting a maximum 5% of your
entire bankroll on the table at any one time, which works out the same as having
20 times the buy-in for the game.
(100/2000 * 100 = 5%)
If you like to play Limit Holdem however, you should have at least 300 Big Bets as
a minimum for the limit you wish to play. Therefore if you were to play $0.50/$1
Limit Holdem, you would need a bankroll of at least $300.
It is recommended that you have a bankroll that will give you 40 buy-ins to the level
of tournaments that you wish to play at. Therefore if you want to play at the $5+$0.50
SnGs you would be looking to have a bankroll of $220.