Texas Holdem Equity

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The flush draw with one overcard now is down to 28% equity (aka chance of winning). The straight has even less than 20%. It follows that you usually have to fold the draws in case your opponent bets big. Hint: Generally speaking you’ll always want to see the river with a draw but sometimes the pot odds won’t be good enough.

The term equity simply refers to the value of an item, place or thing minus any liens owed or interest by other shareholder's.

Poker Equity Chart: Common PREFLOP Scenarios. The chart below indicates the preflop equities of various matchups of poker hands when two players see a flop heads-up in Texas Hold’em poker. Regarding preflop equities and the chart above, a few interesting things to note, include the following. An explanation of the term 'equity' as it is used in no-limit hold'em when estimating the current value of one's hand. + Get the Ultimate Beginner’s Guide to Texas Hold’em - FREE! Heads Up Equity Tables in Texas Holdem. Below is a table showing how each of the 169 possible starting hands fare in an all-in (i.e no folding) head to head match up against a random hand. The hands are listed in order of highest to lowest Pot Equity. Click on any of the hands for a table listing each of the 169 opposition hands and equities. In Texas Hold'em, poker odds are THE probability tool you need as a poker player. In fact, you should always be thinking about poker odds - yours and your opponents' - when making decisions. In short, poker odds is the probability of you winning that hand, or the price it offers (pot odds).

The most common example would be the equity one might have in their car or home. Say, for example, that you have a home that is worth $500,000 and you owe the bank $350,000 before you actually own it. The difference of $150,000 between what you owe and what the house is worth would be your 'equity.'

Equity in poker isn't any different. A player's equity is defined by the strength of their hand in comparison to the other player's hands that are involved in the pot. And just like a home, where the value can change overnight thus changing the equity the homeowners have, a player's equity in a hand can change just as quick due to variables such as seeing another card or a player entering or leaving a pot.

Poker Equity Example

To actually be able to accurately calculate your equity in a hand, you're going to need to be able to put your opponent(s) on a range of hands and asses how that range has connected with the flop, turn and river. You have do use a range because you obviously cannot put your opponent on only two cards. However, for the purpose of this article, we'll assume that our opponent is actually playing his hand face up to make the idea of equity in poker much easier to understand.

In this example, we are in a heads up pot with 5/10 blinds and we both have $100 stacks. Our hand is AJo and our opponent's hand is KQs.

We'll first look at the equity of these two hands from an all in preflop perspective. To figure out how much equity we'll have, we'll use a tool such as Poker Stove to figure out how often we expect to win with our AJo.

• AJo will win 56.08% of the time and lose to KQs 43.44% of the time.

Once we have that data, figuring out our equity is simple. You simply take the amount of money that is in the pot and multiply it by the number of times you expect to win. Since we both have $100 stacks and are all in, the pot is now $200. Here is what the equity calculation would look like.

• .56 * $200 = $112

If you include the money that we gain from when we tie (.24% = $4.80), you'll see that we have approximately $116.80 in equity when we are all in preflop. What this means is that getting our stacks in preflop with AJo against KQs is going to be +EV earning us $0.16 for every dollar we invest.

Now, let's take the hand further and say we saw a flop of A-J-5 rainbow giving us two pair. All of a sudden, we go from having a little bit of equity to having tons of it. To figure out exactly how much, once again, we will use Poker Stove.

After you plug the numbers in, you'll see that we are more than a 4-1 favorite to win this pot. To be exact, we will win 81.86% of the time and lose 18.13% of the time. There are no possible ties.

To calculate our equity here, we do the same thing as above. We take how often we are going to win and multiply it by the amount of money that is in the pot. Here is what the equation would look like assuming stacks went in on the flop.

.818 * $200 = $163.60

As you can see here, getting our money in on the flop as an 80% favorite is excellent. We have $163.60 in equity - this is equal to earning $.68 profit for every dollar we invest.

But let's turn the tables now. Remember that I said that equity could shift quickly due to another card being dealt. With that in mind, we'll say that we saw a turn which was a ten and completed the rainbow (no flushes possible). This is the worst possible card in the deck for our AJo because it gives our opponent a straight and leaves us drawing slim. How much equity do we have now?

Well, after running the numbers in Poker Stove, you will see that we are only 9% to win and 91% on average to lose. Here is how much equity in the pot we now have.

.09 * $200 = $18

With the change of one card being dealt, hopefully you can now see that we went from having a whopping $163.60 in equity to having only a measly $18 in equity - we're now losing money in the long run.

Texas Holdem Pot Equity

Why Learn About Poker Equity

Learning about poker equity is important because as you can see from our example above, you want to try to get your money in when you are ahead (have equity) and minimize how much you invest when you are behind (little to no equity). This is also known as getting value for your hand and/or charging for draws.

Using the example above, we had the best of it with 2 pair on the flop and were over 80% to win. So in this case, you want to be getting as much money into the middle as possible as 80% equity is a substantial amount of money over time. In addition to value, we knew our opponent had KQ and was drawing to a straight. So betting on the turn also charges the villain to draw incorrectly to a better hand. After all, we don't want KQ to improve and take our equity without having to pay to do so.

Summary of Poker Equity

In short, having an understanding of equity is important because if you can identify situations where you are ahead, behind or somewhere in the middle, then you can make your betting decisions accordingly. This is simply known as maximizing your wins while minimizing your losses.

Last week’s article from the “Strategy Vault” shared a past discussion with Andrew “BalugaWhale” Seidman about floating versus bluff-raising after the flop. There Seidman related his thought process when after having called a preflop raise from position, he misses the flop and watches his opponent makes a continuation bet. Folding is always a choice here, but he focuses on instances when he’d rather “float” or call the bet with an intention of bluffing on a later street, or go ahead and bluff right there by raising.

Seidman’s explains how decision in such a spot is affected in part by how his opponent plays, and also by the “equity” he has with his hand that missed the flop. You can go back to that article to see how the combination of his opponent’s style and the relative equity of his hand affects his thinking, but I wanted to stop and linger a little over that term — equity — and talk about how it relates to poker, generally speaking.

What is “Equity”?

The word itself actually means “fairness” — or the quality of being fair or impartial. That idea comes to us sometimes when things don’t seem so fair at the poker table. You get your stack in with versus an opponent’s and a king spikes on the river — not fair!

Equity also refers to someone’s “share” of something, as in shares owned in a company. With your aces you might have claimed a “rightful share” to most of the pot while your opponent with kings has much less of a “right” to what’s in the middle. But after the community cards came and that king fell, you lost your equity and he got every chip.

That situation refers to equity after the all-ins have already come. What about during a hand, when there are still decisions to be made? Of what relevance is equity then?

The first time I ever really bothered to think seriously about what equity meant probably came at some point after buying a home. For those who haven’t gone through the process, most of us don’t buy a home outright, but perhaps make a down payment (some % of the total cost) and take out a mortgage to cover the rest. From there we make payments each month, with the majority of that payment actually going to the interest on the loan and the rest to the principal.

Ultimately your home equity refers to what part of the home you actually “own” as determined by that original down payment plus whatever you’ve paid so far. Also, if the house has gained in value since the time you bought it, that, too, helps build your equity in the home. (By the same token, if your home depreciates in value you lose equity.)

Texas Holdem Pot Equity

While buying a home can be pretty complicated, the general idea of equity is fairly simple. The equity you have in your home is essentially what you would earn if you were to sell it, something that’s affected greatly by what you “put into” it both at the time you bought it and with the mortgage payments you made afterwards. Before you sell the house you can estimate this figure by looking at the current market value of the house and subtracting your outstanding mortgage balance. If I think I can sell the house for $200,000 and I currently have a $120,000 balance, my home equity is $80,000.

That said, I don’t actually realize that equity until I do sell the house. And the longer I wait, the more things could change between now and then.

Equity = Current Value

The idea of equity works similarly in poker. It essentially represents a theoretical amount you “own” of every pot for which you compete. I say “theoretical” because in the end not everyone gets to realize their equity in every pot — in fact, usually only one person does.

You hold and your opponent has . You raise from late position, he calls from the small blind, building a pot of $300. With five cards to come, you have just under a 45% chance of improving enough to beat pocket sevens. Your equity at this point is 45% of $300, then, or $135.

Texas Holdem Equity Calculator

The flop then comes , giving you top pair. Now with two cards to come, the PokerNews Odds Calculator shows you have a better than 91% chance to win. Suddenly your equity has risen to 91% of $300, or $273. It’s like the market value of your hand just went way, way up. (Unlike what happens when buying a home, equity values change a lot faster in poker hands.) Or you might think of that ace on the flop being a big fat payment lowering the principal of your mortgage. In any case, the future is looking bright.

If you can find a way now to increase the size of the pot, you will also increase your equity. If you bet $100 and your opponent calls, the pot grows to $500 and your equity increases again to $455. For every dollar that goes into the pot here, you increase your equity by 91 cents.

Equity = (Usually) an Estimation

Of course, in an actual poker hand you wouldn’t know your opponent has pocket sevens, so you can’t know exactly how much equity your ace-king gives you. Instead you estimate — top pair, top kicker is likely ahead of most hands your opponent has here, you think, so you probably do have more equity than he does, considering his likely range of hands. That makes it preferable to try to build the pot further and increase that equity.

It was a similar estimation that had inspired you to raise preflop with in the first place. Ace-king is a premium hand, one that stands to be better than most others before the flop, and so your equity would increase by raising and increasing the size of the pot. Home owners looking at a house’s current market value are also making an estimation about how much equity they have in the home, understanding — just like the person with ace-king before the flop does — that it could change in the future.

Going back to Seidman’s discussion, he looks at situations when he missed the flop but may still have equity in the form of a draw that would improve his hand. Thus when he has after a flop he estimates he has practically no equity, while having that same hand on a flop of gives him a flush draw and considerably more equity — a difference (that along with his opponent’s style) will affect his decision whether to call or raise after the continuation bet comes.

Equity does not equal cash in pocket. You still have to close the deal, so to speak, which can be complicated — whether you’re selling a house or trying to win a hand of hold’em. But being able to estimate your equity at any given moment in a hand by accurately comparing its value with the value of others’ hands better informs your decision-making going forward.

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