Introduction to ICM – The Independent Chip Model Explained
ICM is key when it comes to making all-important call or fold calculations in the later stages of an MTT or SNG. The Tip Top Fox explains the method behind the ICM madness
ICM stands for Independent Chip Model, a mathematical model used to estimate the equity of different stack sizes in a poker tournament. ICM reflects the profound difference between tournament and cash games. In a cash game, $1 is $1, no matter if it’s in your stack, the pot, or your opponent’s stack.
However, in a tournament, a chip can have different values depending on a number of factors. These include payout structure and the size of your opponent’s chip stacks.
While tournament chips have no real monetary value, an estimated value can be assigned to each depending on your position in the stack size pecking order. The more you have, the less each is worth in estimated monetary value relative to your standing in the tournament. Conversely, the fewer chips you have, the more each is worth.
While the value of your chips is irrelevant until you hit the cash spots, you can calculate your equity in a hand. Then you can work out whether it is positive or negative in relation to your expected value (EV) to make a call or fold with a specific hand in a certain situation.
So how do you use ICM to make good decisions in a tournament? Let’s start with an example: In a US$500+$65 buy-in 6-man SNG on PokerStars, three remain in the tournament. Blinds are 100/200 and you are Big Blind with 4,300 chips holding ace-eight offsuit. The Small Blind has 3,500 chips and the Button is the short stack with 1,200 chips. The Button folds then the Small Blind moves all-in. So should you call with ace-eight?
To solve this puzzle, let’s use an ICM tool to figure out what kind of favourite your ace-eight offsuit needs to be to make the call +EV. Our favourite free online ICM tool, ICMizer, can be found HERE.
Then basically plug in all the numbers including everybody’s stack sizes and the payout structure. In a typical PokerStars $500+$65 6-man SNG, first prize is $2,086.50, second prize is $1,123.50, obviously in this case third prize is a big fat zero. You have two options facing an all-in from the Small Blind: fold or call.
If you fold, then stack sizes will be you: 4,100, second largest stack: 3,700 and the short-stack is still 1,200. When you plug these numbers into the stack size boxes of each player and click ‘calculate’ you get the equity of your 4,100 stack, which is $1,387.
Now let’s consider what will happen if you call the Small Blind’s all-in: If you call and win, then the Small Blind is out and you will have 7,800 chips vs. the short-stack’s 1,200 chips. Plug in the numbers and your equity is now $1,958.
If you call and lose, you end up with 800 chips; the Small Blind becomes the dominant chip leader with 7,000 chips, and the other player still has 1,200 chips. Plug in the numbers and your equity becomes $550.
Crunching the Numbers
Ok, so what is the break-even winning chance that makes you indifferent to calling or folding?
Let’s assume your winning chance is X.
Then you need to solve the following equation:
1,958X + 550(1-X)=1,387
Using some high school level algebra, solving the equation means X=0.59
So basically you need at least 59% winning chance to make the call profitable.
The next question then is: What kind of range will the Small Blind push all-in with? Equity range calculating software like Pokerstove is perfect for this. It lets you plug in your opponent’s perceived hand range to see if your ace-eight offsuit has a 59% chance of winning against this range.
This article will not discuss that in detail here as that is beyond the scope of this piece, but this concept can be explored in the following article: Explaining a Poker Hand Range
No Magic Bullet
Suffice to say that correctly estimating your opponent’s pushing and calling ranges is the most important skill in beating SNGs. So ICM is important, but it is not the magic bullet that will solve all tough SNG problems. If you can’t correctly estimate your opponent’s hand ranges, then the calculation of ICM can’t help you that much. But it at least gives you some vague ideas that what kind of hands you can call with in this scenario.
When you play multiple SNG tables simultaneously, there is no time to do all these calculations on the fly. After a session, if you have doubt about some hands, you can enter the numbers into an ICM calculator and Pokerstove. Then do some calculations to see if you made the right decision. Then next time at least you will have a better idea if a similar scenario surfaces. It is a never-ending process.
Another limitation is that at the lower limits some people have no idea about ICM. Then you need to adjust to these kinds of players; the important point is just because you know ICM doesn’t mean your opponents are aware of this concept.
In the long run, these players who have no idea about ICM will hand their money to you. You will, however, have to adjust your play to deal with this kind of player and may get sucked out on regardless. While ICM is an important tool in SNG decisions, it by no means solves all your problems.
Ok, now it’s the time for you to play with this valuable online tool a little and study the concepts.