Real Poker: Equity And Expected Value (EV): There’s A Difference!

Equity is the percentage share of the pot that you will win or split after all the cards are dealt out; folding is not quantified. This is calculated at the current point, and assumes no more betting. Your equity typically changes after another card is dealt. So, equity is calculated as if all hands are face up, all-in, and cards are dealt until the river with no further betting.
Importantly, equity doesn’t incorporate the value of any bluffs or future wagers; it’s strictly a hand vs. hand percentage. It can be expressed as a percentage or as the dollar portion of the pot that the percentage represents. For example, if your hand is 50:50 to win in a $100 pot, your equity is 50 percent or $50. If your hand is 80:20 to win, your equity is 80 percent or $80.
In practice, you can rarely put your opponent on an exact hand. Great hand readers mostly think in terms of ranges. So, your poker battlefield calculations are generally expressed as how your hand plays against a range of hands. For example, how much equity does K-K have playing against a range that includes A-A, K-K, Q-Q, and A-K? The narrower and more confidently you can determine by hand reading your opponents’ ranges, the more useful your knowledge of equity will be. Several purchasable computer programs provide equity analysis against hands and ranges from all vantage points. Utilizing their data will upgrade your feel for situations at the table.
You should realize that equity is based on the current pot at the current point. It is used to determine hand value when considering value betting, bluffing, semi-bluffing etc. It’s important in strategic poker analyses to understand a high equity bet has greater value than a low equity bet. While that is self-evident, many players don’t calculate the differential into their strategy. Note on the equity analysis programs how significantly the low equity portions of your opponents’ ranges affect the situation’s overall equity.
Since equity changes based on future cards, you need to analyze how the hand will play and how likely the equity is to change in formulating your best strategy. That’s often a deep calculation that requires much knowledge, experience, and an advanced thought process. A low equity situation can gain value in the future if it leads to a high equity wager. A simple example is, a hand with 100 percent equity can be slowplayed more readily than a hand with 60 percent equity. Amongst other issues, the equity cost of the slowplay assumes less risk and often higher equity on future streets. All that said, to develop your thought process, you must first understand the concept.
The word “equity” is also used in a conceptual model. Terms like “fold-equity” quantify the value of your opponent’s folding range in a given situation. The higher your fold-equity, the more correct it is to bluff.
Expected value (EV) is a rough justice estimate of the average amount you should expect to win in a given situation against your opponents’ hands or ranges. It incorporates equity value, fold-equity, bet-sizing, implied odds, etc. In short, all the dynamics that go into your edge, incorporating all possible circumstances. If you’re all-in, you can calculate your EV based on your equity and the pot size, but nearly all poker scenarios have too many variables, such as pot size, bet size, stack size, opponents’ varying ranges to exactly quantify EV.
The independent sum of amount of money you bet times the EV of those bets added into a recurring field will equal your expectation over the course of those bets (V x EV)=EX. That’s why you win, you bet with the best of it and over time and many trials luck becomes a neutral factor, and your earn will equal your expectation. So the greater the volume you bet with the best of it, and the higher your edge, the greater your win rate. Your focus at the poker table should be maximizing as much EV as possible.
Utilizing the EV concept involves doing rough justice estimates on how you can maximize your EV in the current situation. Will checking one street provide you higher EV on the next? Will it make up any EV you gave up by checking the previous street? Does betting more as a bluff increase your EV enough to assume the extra cost? The variations to apply your understanding of EV are many and often complex. But the fact that you understand the concept and think about how to apply it will greatly improve your poker decisions.
And making better decisions than your opponents is what will put the dough in your pocket! ♠

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