You’ve probably heard pot-limit Omaha characterized as “a game of swings,” a reference to the fact that the game can be quite volatile in terms of its effect on your bankroll. It is safe to say that while variance is always dependent on a given player’s style and skill level relative to his opponents, generally speaking, PLO is a much more “swingy” game than no-limit hold’em or many other forms of poker, for that matter.
There are a couple of explanations for why PLO is such a high variance game. And a couple of consequences worth mentioning, too.
One reason why PLO is so volatile has to do with the fact that draws play such a major part of how hands go. One plays draws in no-limit hold’em all the time, of course, and while players will sometimes find themselves taking “coin flips” or 50-50 situations, such occurrences are much more frequently encountered in pot-limit Omaha. It is often correct to bet one’s draws aggressively in PLO, since in some cases the drawing hand is a favorite over the made hand. For instance, someone who flops a “wrap” draw to a straight with 20 outs is often going to be a statistical favorite over the player who flopped top set. And since neither player is likely to want to get rid of such strong hands, into the middle the money will go.
That said, draws don’t always get there, even if they are favorites to do so. Thus, one is often forced to gamble like this much more frequently in PLO than in no-limit hold’em. Again, such a statement does depend on other factors, too, as some players are able to adopt a much less risky, less volatile style and be successful at PLO.
Another reason why PLO can be especially volatile actually has to do with the wildly varying skill levels of players one encounters at most games. Pot-limit Omaha attracts many players because of the action it provides, and many of these players do not necessarily play “correctly.” While such players are good for the game and over the long haul will help pad the more skillful players’ bankrolls, they do introduce an added element of risk that again will have the effect of increasing volatility.
As for the consequences of PLO’s high volatility, one is that you are probably is going to need a larger bankroll to play the game comfortably than would be required by a no-limit hold’em game in which the average pot size was the same.
A second, more pleasant consequence is that because of the higher variance, the skillful player stands to find a PLO game more profitable than the equivalent stakes no-limit hold’em game. That’s because while the wins and losses will both be greater than what you will experience in no-limit hold’em, the overall profit margin will likely be greater, too — if you’re a winning player. If you’re a losing player, then the losses should be greater as well.
