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ICM

Why tournament chips aren’t money: the Independent Chip Model, prize equity, and why calls get tighter near the money.

8 steps, as text. step through the interactive version →

  1. 01, open this step in the interactive version

    Three players are left in a tournament. The prize pool pays 50% to first, 30% to second and 20% to third.

  2. 02, open this step in the interactive version

    You have half the chips. The other two have a quarter each. How much of the prize pool is each stack worth?

  3. 03, open this step in the interactive version

    starts from one assumption: your chance of finishing first equals your share of the chips. So you win half the time.

  4. 04, open this step in the interactive version

    If someone else wins, you’re the favourite for second among those left, again in proportion to chips. Whatever remains is third.

  5. 05, open this step in the interactive version

    Weight each place by its prize. Your 50% of the chips is worth about 38% of the money.

  6. 06, open this step in the interactive version

    The short stacks are worth 31% each from 25% of the chips. In a tournament, chips you win are worth less than chips you lose.

  7. 07, open this step in the interactive version

    So calls get tighter. B goes . Win and you’re far ahead; lose and you’re a short stack. You need about 53% to call, not 50%.

  8. 08, open this step in the interactive version

    Change your stack and how top-heavy the payouts are. When the winner takes everything, chips are money again.