Don’t just hand over your chips
Take a look at a tournament chip. You will probably find some variation of “no cash value” printed on it. While you won’t get very far trying to spend it at the mall, that chip does have a real dollar value during a tournament. You can determine its value using an Independent Chip Model (ICM) calculator. ICM assigns a dollar value to a player’s stack based on his percentage of the chips in play and the payout structure of the tournament, calculated by determining the probability that the player has of winning each remaining prize. Therefore, in the early stages of a tournament when stack sizes are pretty even, ICM considerations are few and far between, as each player has a similar chance of winning each prize. ICM comes into play more in later stages of a tournament when the money bubble approaches, and then again at the final table with big pay jumps on the line. Having a decent grasp of ICM can help a player assess and manage risk during these two important stages of a tournament.
I have listened to players recount brave hand histories where they busted in a blaze of glory, defending their extremely risky play with the macho excuse of “playing for the win.” There is considerably less glory in making smart, calculated plays to keep a middling stack afloat than there is in constantly pressuring opponents and gambling for huge stacks. However, smart players consider ICM in their decisions to play for the long-term win, making the most money out of their stacks in the long run, instead of gambling for short-term gains. Sure, if you dive head first into a massive coin flip with your tournament life on the line and win, you are in a much better position to win that particular tournament. However, being out of the tournament 50 percent of the time after that coin flip may yield you worse results in the long run.
How do you determine when to take the gamble and when to lay it down? Consider a couple examples:
You made it down to four players in a big tournament. You each have 25 percent of the chips in play with $100,000 for first, $50,000 for second and $25,000 for third. Each player’s stack is worth $43,750, nearly second-place money. In this scenario, a player would need incredibly good odds to justify calling an all in. Let’s look at some math to demonstrate why this is:
When you call all in and lose = 0 percent of chips in play, loss in equity of $43,750.
When you call all in and win = player climbs from 25 percent to 50 percent of chips in play, gain in equity of $27,080, new ICM value of $70,830.
If you feel you are 50 percent against your opponent’s range here, it is a very clear fold. The chips you lose in this spot are far more valuable than the chips you stand to gain if you win. This is because even when you win this flip, your bystander opponents get a cut of the equity that the busted opponent just lost, $16,670 of it to be exact. Who wants to share their spoils of victory with a guy who did nothing to earn them?
Same parameters as above. You made the mistake of calling an all in for a coin flip, but (hooray!) won the flip. You now possess 50 percent of the chips in play, worth $70,830. Each opponent has 25 percent, worth $52,080. The situation has drastically changed for you, as now you can put pressure on your opponents without risking as much yourself. Let’s examine why using an ICM calculator:
You shove AQs on your opponent, forcing her into a decision with 88 for all of her chips.
When you get called and lose the flip: You fall from $70,830 in equity to $52,080, a loss of $18,750 in equity.
When you get called and win the flip: You have 75 percent of the chips in play heads up with an ICM value of $87,500 for a gain of $16,670.
Was this a bad shove? You only gain $16,670 when you win and give up $18,750 worth of equity when you lose. While this doesn’t sound too profitable on its face, it is necessary to assess the ICM implications your shove will have on your opponent to determine that shoving here is actually a very profitable play.
When opponent calls and loses flip: She receives $25,000 for third place and is eliminated from the tournament for a loss in equity of $27,080.
When opponent calls and wins flip: She has 50 percent of the chips in play and $70,830 in equity, a gain in equity of only $18,750.
Forcing your opponent into a decision to coin flip for a loss of $8,330 is an extremely profitable play. A smart player who is aware of ICM consequences must fold in this spot if she suspects a coin flip scenario.
If you are wondering why the numbers don’t add up, remember that the innocent bystander in this ICM disaster call-off, our other opponent, gains the small amount of ICM equity we lose in the course of our coin flip. Sometimes it is profitable to sit back and pick smart spots if your opponents are willing to mix it up with each other.
An ICM calculator is a great tool to use deep in tournaments when payjumps are looming, but there are some limitations to ICM as a result of its purely mathematical nature. It does not account for the difference in skill between players, the position of players at time of calculation, and the obvious leveraging opportunity that a skilled chip leader will have over his opponents who are trying to ladder up the payscale.
Even if you decide not to incorporate hardcore ICM calculations into your game, simply remembering that the last tournament chip you own is the most valuable chip will greatly improve your long-term profitability. Making a tight fold where you are slightly ahead (a negative chipEV fold) can often yield positive results in actual dollars.