Explanation of Pot Odds
We don’t necessarily need to be a favourite to win a hand in order to justify calling. Since there are typically chips already in the pot, we generally stand to win more than our investment when making the call. As such, it can be theoretically correct to make calls even when we are the underdog.
The relationship between what we have to call and the amount of chips already in the middle is referred to as “pot odds”. Traditionally, pot odds are expressed in a ratio format, but in modern times many poker players are converting to a percentage method of measuring pot odds.
The smaller the size of our call relative to what is already in the middle the “better” our pot odds. Another way of expressing this concept is to say that “we get a good price on the call” when the size of the call is small relative to the current pot size. Let’s see an example of how pot odds are calculated.
Example: There is 100bb in the middle on the river. Our opponent shoves all-in for his last 50bb. What pot odds are we being offered?
Let’s start with the traditional ratio method for the sake of completeness, but it is perfectly ok to ignore this and purely use the percentage method.
There is currently 150bb in the pot after opponent shoves and we’ll be investing 50bb on our call. We are hence being offered 150bb:50bb. We can simplify this ratio by finding the largest number that both values are divisible by; in this case 50. By dividing both values by 50 we can simplify the ratio to 3:1 pot odds.
Pot size before our call: 150
Our call amount: 50
Ratio 150:50 or 3:1 pot odds.
For the more flexible percentage method (we’ll see why this is more flexible shortly), we look at the total size of the pot after we make the call, and see what percentage of the total pot we are investing. If we would make the call the total pot size would be 200, of which we are investing 50. To convert this into a percentage we can divide our investment by the total pot-size and multiply by 100 → 50/200 = 0.25 → 0.25*100 = 25 We are hence being offered 25% pot odds.
Pot size after our call 200.
Our call amount 50
(50/200) * 100 = 25% pot odds.
How to Use Pot Odds as Part of Your Poker Strategy
When faced with the decision regarding whether or not to call an all-in, there is a direct relationship between our pot odds and how much equity we need in order to call profitably. In fact, the percentage in terms of equity is identical to the percentage in terms of pot odds. So, if we are being offered 25% pot odds we need 25% pot equity in order to make the call.
If we are calculating pot odds in ratio format we will need to first convert it into a percentage so that it can be compared directly to our equity. Note that by calculating our pot odds directly as a percentage, we are making our calculation easier by skipping out an unnecessary step. This is why modern poker players have abandoned the use of ratios entirely when calculating pot odds.
How though, do we know much equity we have? Since we don’t know our opponent’s exact holding, we will need to make an estimate regarding our pot equity. For more information on how this can be done, see the glossary entry under equity.
It’s important to remember that pot odds only apply to all-in situations. In situations where we are making a call with additional chips still behind, it’s necessary to make an adjusted pot odds calculation referred to as an “implied odds” calculation. For more information on how to tailor our pot odds calculation to take into account play on future streets, see the glossary entry under implied odds.