When There Are Payout Implications

Payout Implications
• As you get closer to getting in the money or when there will be a payout jump
soon, you should avoid taking substantial risks that could bust you.

• The Independent Chip Model (ICM) will help determine

exactly how to alter your strategy.

• Postflop adjustments will be discussed later.

ICM
• The payouts and the chip stacks remaining in the field can be used to
determine which adjustments you should make.

• ICM calculates the probability of each player finishing in a particular place

and multiplies those probabilities by the payouts for each position.

• ICM does not account for skill edge, relative position, and increasing blinds.

• ICM is important because it usually comes into play when lots

of money is on the line.
ICM
• The number of chips you win (cEV) and their monetary value ($EV) are
usually different when there are payout implications.

• This is because chips you lose are worth more than chips you win.

• Making a profitable cEV call may lose you $EV.

 Position Payouts
1st
ICM Example 2nd
$1,000
$700
rd
• Four players remain in a tournament with each having 25% of the chips. 3 $400
4th $200

• Each player’s stack is worth $575.

• (1,000 + 700 + 400 + 200)/4 = $575

• If you get all-in with 50% equity, when you win, your equity becomes $800
(solved using an ICM calculator) and when you lose, you take 4th place
for $200, giving you $1,000 total.

• This means when you and your opponent get all-in, you put
$1,150 total into the pot but only get back $1,000.

• You should strive to call off in breakeven situations.

Situations Vary!
• The largest payout jumps are usually the initial payout when you
get in the money and late at the final table.

• The other payout jumps are minimal.

• All stacks matter, not just yours and your specific opponent.

• On the bubble when someone has 1bb and everyone else has
20bbs, that is much different than if everyone has 20bbs.

• You are not always in an all-in or fold situation, even with 10bbs!

• Determining exactly how much the payout implications matter

is difficult for non-final table situations, but Risk Premium helps.
Study a Lot!
• Use ICMIZER, Hold'em Resources Calculator,
or ICM Explorer to further study ICM.

• These are paid programs, but ICMIZER is definitely worth it.

• You can subscribe to ICMIZER at JLPoker.com/icm

• Watch my live play videos and hand history reviews to

see me adjusting in real-time.
Risk Premium in Substantial Pots
Risk Premium
• When you face a bet for all or most of your chips when there are
payout implications, you need more than the normal required amount
of equity based on the pot odds to call (sometimes much more).

• This is because if you call and lose, you are out or nearly out and if
you win, you do not double your equity.

• Play cautiously when you are potentially at risk in a marginal spot.

• Look to play pots where you can put your opponent at risk.
Risk Premium
• You need to consider risk premium both when betting and calling a
bet.

• You have a different risk premium against everyone at the table.

• But, if your risk premium is much less than your opponent’s, you get to
apply more pressure.
Risk Premium Matrix
• It is difficult to know exactly how much the risk premium is
because all situations are different, but here are rough guidelines
for the final table when facing an all-in, or mostly all-in bet.

• You need this much more equity when calling a substantial bet.

• Play more cautiously in flat payout structures.

• Play more aggressively in top-heavy payout structures.

Risk Premium Example
• On the bubble with no obviously tiny stacks, everyone folds to the
big stack with 40bbs in the small blind.

• You have 10bbs in the big blind.

• Which hands should he go all-in with?

• Which hands should you call with?

Risk Premium Example
• On the bubble with no obviously tiny stacks, everyone folds to the
big stack with 40bbs in the small blind.

• You have 10bbs in the big blind.

• Which hands should he go all-in with? ALL OF THEM!

• Which hands should you call with?

Risk Premium Example
• On the bubble with no obviously tiny stacks, everyone folds to the
big stack with 40bbs in the small blind.

• You have 10bbs in the big blind.

• Which hands should he go all-in with? ALL OF THEM!

• Which hands should you call with? IT DEPENDS!

Risk Premium Example
• If there are a few short stacks who are very active, you need more
than 9% - 15% additional equity.

• If you are the only short stack, you may need less than 9%.

• Let’s presume you need an additional 12% due to the bubble.

Risk Premium Example
• You are calling 9bbs to win 21bbs, so you need to realize 42.8%
with no payout implications.

• With payout implications though, you need to realize 54.8%.

• If you want to profit, you need perhaps 56% equity.

• Which hands have 56% equity against a 100% range?

Risk Premium in Non-Substantial Pots
Risk Premium in Non-Substantial Pots
• Risk premium still matters even when all your chips are not % Stack at Risk Risk Premium
at risk. 5% 1%
10% 3%
• This chart is just a guide, adjust accordingly! 15% 3.5%
20% 4%
25% 5%
• Even when calling an initial raise, you should be a bit tighter.
30% 6%

• This will result in you defending your big blind less often.

• This also applies postflop, but that will be discussed later.

Risk Premium Example
• At a final table, the lojack with 25bbs raises to 2bbs % Stack at Risk Risk Premium
and everyone folds to you are in the big blind, also 5% 1%
with 25bbs. 10% 3%
15% 3.5%
• Which hands should you defend with? 20% 4%
25% 5%
30% 6%
Risk Premium Example
• At a final table, the lojack with 25bbs raises to 2bbs % Stack at Risk Risk Premium
and everyone folds to you are in the big blind, also 5% 1%
with 25bbs. 10% 3%
15% 3.5%
• Which hands should you defend with? 20% 4%
25% 5%
30% 6%
• The other stacks matter!

• Generally fold out the bottom of the

range and do not 3-bet as often.
Why not play manically?
• Because when your overly aggressive plays fail, everyone else profits.

• Playing maniacally will indeed result in you winning the tournament more often.

• However, each maniacal play costs you some amount of money in the long run.

• You are literally giving that money to your opponents.

Everyone is Not Aware of ICM!
Everyone is Not Aware of ICM!
• Some players have not studied ICM well.

• Others just “play for the win”.

• Others blind out because they REALLY care about moving up the payouts.

• Your opponent’s strategy is vitally important!

 Position Stack

Example Lojack
Hijack
25bb
35bb
• Everyone folds to you in the small blind with a 10bb stack at a Cutoff 15bb
final table. Button 35bb
SB (You) 10bb
BB 20bb
• Which hands should you normally go all-in with?

• What about if the big blind will only call with 7-7+ and A-10+?

• What about if the big blind will call with any two cards?
Many Players Overvalue “Strong” Hands
• As a big or medium stack, when facing a substantial bet, you
have to call tightly.

• This is magnified even more by multiple short stacks.

• 10-10 and A-K are often folded to substantial preflop aggression

when you have to call off your entire stack.

• Strong hands that do not actually want to call off (like 10-10 and
A-K) are often better jammed all-in when you are folded to or
called (or jammed all-in) when facing a raise from a larger stack.
Some Big Stacks are Lunatics
• Watch out for big stacks that think their job is to bust the short stacks.

• In reality, the big stacks should not mind the short stacks being at the table.

• Go all-in with a wide range for 15bb – 30bb over loose raises.

• If multiple players are playing many pots aggressively,

tighten up because they will eventually bust each other.
ICM Adjustments
Who can apply pressure?
• The largest stacks can apply pressure to everyone at the table.

• Medium stacks can apply pressure to the medium and shorter stacks.

• Shorter stacks can apply pressure to other shorter stacks.

• Sometimes you should be the aggressor and other times, cautious.

• Sometimes you will be playing with various implications.

At Any Payout Jump…
• Make sure you are vitally aware of the payout implications.

• Whenever you are at a payout jump, when you are at risk, stall!

• Whenever you have a tiny stack, take your time.

• When you are going all-in, go all-in minus 1bb.

• This will allow you to take additional time to give you

a chance to ladder up.
ICM Adjustments with more than 60bbs
With more than 60bbs as the Aggressive Stack
• Put shorter-stacked opponents in difficult spots by applying aggression.

• Raise with wider ranges.

• Call raises with wider ranges.

• 3-bet more often.

• Being a maniac may be ideal, with extreme payout implications.

• Be careful when a shallower stacked player tries to get all-in.

With more than 60bbs as the Cautious Stack
• Avoid marginally profitable high risk situations.

• Give up a little profit in exchange for going broke less often.

• Raise with stronger ranges.

• 3-bet less often.

• Fold from out of position more often.

• That said, don’t be a super nit.

ICM Adjustments with 35bb to 60bbs
With 35bbs to 60bbs as the Aggressive Stack
• Similar to deep stacked, except the short stacks may be able to go all-in
over your 3-bet decently wide if you are too out of line.

• This may lead you to calling their raises more often instead of 3-betting.
With 35bbs to 60bbs as the Cautious Stack
• If the big stacks relentlessly 3-bet, do not be afraid to 4-bet all-in.

• Do a lot of checking postflop if you expect to face aggression.

• Ideally, you want to be able to lose more than one pot before going broke.
ICM Adjustments with 22bb to 35bbs
With 22bbs to 35bbs as the Aggressive Stack
• Min-raise frequently.

• 3-bet a lot, perhaps jamming all-in.

• 3-betting small could also be ideal, but know what you are inducing.

• Consider 4-betting all-in over small 3-bets from wide 3-bettors.

With 22bbs to 35bbs as the Cautious Stack
• Going all-in over a raise is often your best option with non-premium hands.

• 3-betting small with mostly the effective nuts plus a few blocker bluffs is
excellent against overly aggressive big stacks.
ICM Adjustments with 12bb to 22bbs
With 12bbs to 22bbs as the Aggressive Stack
• Min-raise frequently.

• 3-betting small loses merit due to getting excellent pot odds when you
face an all-in.

• Call somewhat tightly against short all-ins.

With 12bbs to 22bbs as the Cautious Stack
• Open shove all-in more often.

• When facing a raise, usually go all-in or fold.

• Call off against all-ins tighter.

ICM Adjustments with fewer than 12bbs
With fewer than 12bbs as the Aggressive Stack
• Usually go all-in or fold.

• However, min-raising is still a powerful play if your opponents will not go

all-in often enough, especially with weak blocker hands.
With fewer than 12bbs as the Cautious Stack
• Go all-in or fold in most situations.

• Go all-in tighter than normal.

• Call off against all-ins tighter.