Taking the future betting action into account.

Implied Odds

When deciding whether to play a hand or not, the first thing we do is usually comparing the current pot odds (that is, the size of the pot relative to the price of calling) to the odds of winning. If it appears that the former is bigger than the latter, we usually have a call, since the payout will more than make up for all the times we lose.

However, this simple analysis assumes that there will be no further betting, or that it will be negligible compared to the current pot - which is often wrong. You sometimes know that you are going to collect several extra bets if you make your hand, and you may even get fierce action after you improved to a winner. Such cases are obviously very favorable, and should be taken into account in the evaluation of the situation. The future action can indeed turn a marginal call into a good percentage play, or even a fold into a call.

What we call implied odds is the comparison of what it costs to play versus what you expect to win on further betting rounds, in addition to the current pot.

Some hands offer much better implied odds than others. Situations when your opponent can figure out what you are most probably holding are generally very bad for your implied odds, since your opponent is not going to pay you much, unless there are other factors impacting his decision, like his tendency to overcall with hand he likes, or his steaming from previous losses. But as a rule, you cannot count on good implied odds if your hand is pretty obvious.

Example

A $1-$2 No Limit holdem game, 8 handed. The table is playing tight-aggressive, most players are good. The player third to act raises two-third of the pot, after the two previous players folded. The cut-off (the seat on the right of the button) calls, and you elect to call on the button with . The big blind calls, and the other players fold.
The flop is , givving you a flush draw. The big blind checks, and the preflop raiser bets again two-third of the pot. The cut-off makes a minimum raises. It’s your turn.
If you call, there is little doubt that you will have to complete your flush to win. But if you are lucky enough to make it, are you going to get paid? It will be relatively clear to your opponents that there is a possible flush, and with four players to see the flop, this is a real threat. A solid, tight player is not going to pay you here, unless he believes he is playing a very frequent bluffer - and even then, he will carefully pick the situation to make a stand. If you make the flush on the turn, you will perhaps be able to collect some cash if someone has a set, and the price is right for him to try and draw on you (to a full house). If you don’t make the flush on the turn, you will be bet or raised out of the pot. Even though you have a good position, the action indicates that you are behind, and what you know from your opponents indicates that making your hand is likely to freeze the action. This translates to bad implied odds. And we didn’t even mention that you can lose to a better flush, since you are not drawing to the nuts.

Conversely, a well-concealed hand usually offers good implied odds, since your opponents will not put you on that hand. Some straights can be more disguised than a flush, especially when you have a hand with a gap, like seven and five. Indeed, your opponent will reason that you need exactly those cards to have the straight, and will mentally lessen the probability of someone having the straight. Sometimes, he will not believe it at all, or even overlook it, eg. on a 7 4 K J 2 8 board. The 56 can win a good-sized pot on this board.

In short-handed games, flush possibilities are often discounted too, since fewer opponent get to see a flop than at a usual full table. Also, bluffs, and aggression in general, play a bigger role in short handed games, so you can expect more calls from your opponents. Completing a flush can win a decent pot under these circumstances. But be aware that good short-handed players are not going to pay you a fortune on these boards, especially if they have good reading skills, so your gains won’t be gigantic. This somewhat limits your implied odds.

When you and your opponents have big stacks, the cost of entering many pots and calling raises will be smaller compared to your possible gains. You are said to play in deep money. This is the paradise of implied odds. Small investments that can win you big money. In order to do so, you need to trap your opponent, so deception plays a major role. Making small, seemingly incorrect calls or raises is bread and butter. Beginners and average players have an extremely hard time against experienced deep stack players, as so many things are different in these games. This leads us to the following concept.

Reverse Implied Odds

Top pair with top kicker, a strong hand in games with short stacks, or in tournaments, is a frequent trap hand in deep money games. How comes? Well, with big stacks, and experienced player is not going to pay you much with something that top pair/top kicker beats. He has no pressure to play (like in a tournament), and there is usually very little in the pot compared to the stack. If he plays, this generally means trouble for you. Most often, you wiill either win a small pot, or lose a big one if you get stubborn (and beginners do get stubborn, since the very same hand would be fairly strong in other circumstances). This is exactly what we call reverse implied odds.

Win small/lose big are propositions to be avoided at all costs in poker, unless you will win so often that it will make up for the occasional big loss. Some games lend themselves more naturally to implied odds - and reverse implied odds, for the unwary. No Limit Holdem is a perfect example, as well as Pot Limit omaha, to a lesser extent. Players who started out with Limit structures are not used to this, and often severely look down on calling preflop with very speculative hands. Indeed, in Limit Holdem, your possible gains are limited by the size of the bets, and this makes it next to impossible to play these “trash hands” profitably. However, in No Limit poker, this is often alright to pay a small price to try and hit a big flop, against someone who is likely to pay you off.

As a final word of caution, always evaluate objectively the implied odds in your analysis. It is very easy to use implied odds as an excuse to make plain bad calls, playing way too many hands, or pay through the nose to hit a longshot while there won’t be enough money left for correct implied odds. By definition, if someone is all-in or just about being so, there is no implied odds!

Related Items:

• Holdem Frequent Match-ups Odds
• Odds & Pot Odds
• Odds Basics