Understanding Equity

Equity is not so much of a tangible number as it is an estimation. Equity and Expected Value (EV) in poker are used to help determine what the best decision is in a hand at any given point. The premise of equity and EV is the disregard for short term results. It is easy to fall into the trap of thinking your decision(s) were bad simply because they weren’t correct on one random occasion. +EV decisions are what will be best in the long run, and that is all that any player should be concerned with.

What is Equity in Poker

Equity is essentially representative of a parallel universe, as odd as it may seem. When a player is in a spot where a flush hitting or missing will make or break his hand, he is in a spot where equity exists. The time that the flush misses would be representative of the actual result when it is missed while the possibility that the flush could have hit would be the equity.

Equity is best demonstrated, however, in a situation where a player makes a raise (or general bet) that will often induce a fold. For example, a player might hit an open ended straight flush draw on the flop and check. If they check and the other player bets, a check raise would create what is called fold equity.

The fold equity is represented by the differential between potential winnings when they get called and win the pot and the times where the other player folds. In other words it would be OK if the other player would fold as you would win the pot, but you would not be in bad shape if they call as you will be left with a bunch of outs.

What is Expected Value in Poker

EV stands for expected value. Your expected value in any given situation can be positive, negative, or neutral. The aim should always be to make the most +EV move possible, but sometimes your options will have such similar consequences that it won’t matter what you do.

An example of a neutral EV decision would be when you are put to a tough river decision. Many times the difference between calling and folding will be so inconsequential in the end that it won’t even matter what you do. There is a great saying that states, “The toughest decisions will often matter the least”, and these decisions will often be neutral EV.

+EV spots are usually pretty easy to identify as decisions that become difficult will often end up being neutral EV. An example of a +EV spot would be when you are dealt QQ, KK, or AA pre flop. If you get 4 bet and are holding a huge hand like this, it would be +EV to 5 bet (usually all in).

A negative EV decision, by contrast, would be simply calling or folding in this spot. Why would it be negative EV to call or fold? The reasons should be obvious, folding is just burning money and calling will make it difficult to win your opponent’s entire stack. The player 4 bet so they are obviously willing to go along with their hand, you might as well take advantage of this by 5 betting all in.