Learning No-Limit From Scratch ­- Effectively Using Pot and Implied Odds

Risk vs. rewards. It’s the essence of poker, as well as having major applications in life. In poker we express the equation in mathematical terms. “The pot is laying me 2:1,” means that there is twice as much money in the pot than you’re required to call. But that relates only to the “current odds” situation. And it’s correct only if you are closing out the action and there is no more betting.

Both the risks and rewards can increase or decrease if there is action to take place after your decision. If another player calls after you have acted, your odds have changed. You’ve gained or lost the pricing effect of his action. Additionally, the odds of your call change if there is more betting to come. If that betting will provide your positive future edge, then your risk/reward ratio has favorably increased, and the “implied odds” of your current bet have improved. If the future betting will deliver an overall negative edge, then you’ve added to your risks, your risk/reward ratio has decreased, and your initial bet has lost value due to “reverse implied odds.”

Got it? Great! Now we need to know how to evaluate these types of situations as accurately as possible. Say you’re closing the action heads-up facing an all-in bet. It’s $50 to call, and there is $100 in the pot. You’re getting 2:1, and if your hand has a 33.3 percent chance of winning, your call is equity neutral. If your hand has a 34 percent chance of winning your wager has a positive edge. If it has 32 percent, it’s a losing proposition.

Now let’s say you’re facing the same $50 flop bet with a nut flush draw and a nut gutter, you know all your wins are good, but you can’t win in a showdown. You have $150 left, $100 if you call. Your opponent has $100 after betting, and there’s $100 in the pot. Let’s assume you know your opponent will bet the remaining $100 on the turn. Now, disregarding any turn calls should you miss, your odds on your flop call aren’t 2:1 but 4:1. Since you have 12 wins and are about 3:1 against making your hand by the turn, the difference from the current odds the pot was laying you to the sum of the current and implied odds you’re receiving have turned a fold at 2:1 into a profitable call at 4:1.

That’s a very simple example containing nut draws and all-in wagers. Assessing implied odds accurately in most poker situations gets much more complex. Most players tend to assume that they will achieve higher implied value than they can actualize. On the negative expectation side, you might make a hand that is not good, get drawn out on in future streets, or face future bets in unfavorable situations. You might also get outplayed on future streets.

Keep in mind that implied odds are from adding or subtracting the expectation of future bets, not the nominal value of the bet. Hence, if future bets will have an average negative expectation, you are receiving lower odds than the current situation is offering. But, if you will average positive expectation in the future, then your odds have increased. By how much depends on the situation.

Implied odds can be increased, not just by the edge of hand strength, but also by any edges you may obtain by outplaying your opponent on later streets. If you can bluff profitably on a later street, your implied odds have increased. If your opponent is likely to give you a free card on a later street, your implied odds are greater than if he isn’t likely to. Any action that provides you a future edge increases your implied odds.

It’s important to estimate your odds conceptually correctly. Many players just look at the current odds the pot is laying them and make a mathematical determination based on those immediate odds and their hand strength, ignoring any potential future value of the hand, positive or negative. This causes them to fold many situations in which the implied odds of the hand turn a fold based on current odds into a call based on implied odds. Conversely, if they ignore reverse implied odds, they can trap themselves on future streets.

I estimate my odds by analyzing the current odds, then think about how the hand is likely to play out and estimate my implied odds. I emphasize current odds because they are guaranteed, while implied odds are not. Since current odds are guaranteed, the greater the percentage of current odds, the stronger the play. Getting 8:1 guaranteed is superior to getting 2:1 with 6:1 in implied odds. While, assuming an accurate calculation, they will be expectationally equal over time, you’ll be less prone to make errors and you’ll take fewer swings with the guarantee.

Estimating implied odds requires good hand reading and feel. Accurately perceiving your opponent’s range and how he’ll play it isn’t easy. Recognize you’re estimating and accept you’ll make errors. But always make the effort to include your estimate in your odds calculations.

Always know your pricing. Keeping track will help you develop “poker feel,” and you’ll make better decisions.

And that will lead to a bigger bankroll! ♠

Roy Cooke played poker professionally for 16 years prior to becoming a successful Las Vegas Real Estate Broker/Salesman. Should you wish any information about Real Estate matters-including purchase, sale or mortgage his office number is 702-376-1515 or Roy’s e-mail is [email protected]. His website is www.RoyCooke.com. Roy’s blogs and poker tips are at www.RoyCookePokerlv.com. You can also find him on Facebook or Twitter @RealRoyCooke