Fold equity

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Fold equity is a concept in poker strategy that is especially important when a player becomes short-stacked in a no limit (or possibly pot limit) tournament. It is the equity a player can consider him or herself likely to gain if he or she bets. It equates to:

Gain in equity if opponent(s) fold x likelihood that opponents fold

The first half of the equation is known because it is whatever share of equity the folding opponent has. The second cannot be known but must be estimated based on reads or previous actions.

It becomes an important concept for short stacks for the following reason. Opponents can be considered likely to call all-ins with a certain range of hands. When they will have to use a large percentage of their stack to make the call, this range can be expected to be quite narrow (it will include all the hands the caller expects to win an all-in against the bettor). As the percentage of stack needed to call becomes lower, the range of cards the caller will need becomes wider, and he or she becomes less likely to fold. Consequently, fold equity diminishes. There will be a point at which a caller will need a sufficiently small percentage of their stack to call the all-in that they will do so with any two cards. At that point, the all-in bettor will have no fold equity.

Here is an example.

A holds A6. She is heads up with B, who holds 22. The flop is 973 rainbow (no cards of the same suit).

A has pot equity of 31.5% B has pot equity of 68.5%

(In other words, if there was no further betting, and the players simply turned up their hands and were dealt the turn and river, A is 31.5% likely to win.)

If B is 70% likely to fold, A's fold equity is 47.95% (68.5 x .7). Consequently, A can consider that her hand equity if she bets will equal 31.5 + 47.95%, more than 80%.

[edit] Further reading

• http://www.everypoker.com/poker-strategy/fold-equity
• http://www.cardschat.com/blog/06/14/nl-lesson-1-i-have-fold-equity/