Chip Utility

So today I've been looking forward to writing some more about the concept of chip utility that I introduced yesterday, which again comes directly out of Arnold Snyder's great book The Poker Tournament Formula II. As I mentioned yesterday, this is the only poker book I have ever read that specifically addresses the concept of chip utility in this way, although my suspicion is that, like myself, most of the truly good tournament players in the world have an excellent subconcious understanding and feel for the concept in their hand-to-hand play in poker tournaments.

So, to recap, chip utility according to Arnold Snyder is the amount of usefulness or utility a skilled player can expect to get out of the chips that he or she holds in a poker tournament. To Snyder, and this is something I agree with very well, one really needs a good 100 big blinds or more in your stack in order to truly have what Snyder calls "full utility". Full utility means that you have all of your weapons available to you in terms of what moves or tournament strategies you have sufficient chips to make. For example, let's say you are half an hour in to the typical single-stack full tilt poker tournament starting with your standard 1500 chips, and you have yet to win a pot but have raised a couple of times preflop, and called one raise preflop, all three times only to have to fold to overcards and action on the flop. So let's say you're down to 1100 chips thirty minutes in to this tournament, and the blinds here near the end of Round 3 are now 20-40. So with 1100 chips, you have about 27 big blinds.

The first thing to note about chip utility is that it provides quite different analyses of the power of chip stacks than does Dan Harrington in his own awesome books (Volume 1 and 2, anyways) on poker touraments. According to Harrington, nearly 30 big blinds is not huge, but it is way far away from the "desperate" area that I believe Harrington describes as 10 big blinds are less. Now it's not that I (and Arnold Snyder) disagree that fewer than 10 big blinds equals desperation -- clearly, it does -- but the argument here is that even with 27 big blinds, you're not actually in the yellow zone or whatever Harrington calls this level of M. In reality, with 27 big blinds, your chip utility pretty much sucks, and your play should reflect this fact even at this level. Anyone who continues to play tightydonk Harrington-style poker with just 27 big blinds is pretty much wasting their time when they have very little utility left to the chip stack they currently have. Here's why:

With 27 big blinds, 1100 chips and blinds of 20-40, think about all the things you can't do that you'd like to be able to do if you are a skilled tournament poker player. Can you still open-raise the blinds preflop from late position on a pure steal with, say, J8o? Sure. The action folds to you, you bump it up to 120 chips. That's fine. Even that is already more than 10% of your current stack, but you do have enough chips to be able to still put in a standard preflop raise and still be able to fold to a reraise. Barely.

But we are already close to the end of your possible moves with just 27 big blinds at the start of a hand. Think about it. What if your preflop raise to 120 chips gets called by the big blind. So now there is 300 chips in the pot and you see a flop, say it's all rags and it misses your steal attempt entirely. With just 980 chips left in your stack at this point, can you credibly c-bet now, putting in maybe 220 chips into this 300-chip pot? So to c-bet here will take nearly 25% of your remaining stack, and with any further action you are obviously 100% committed to this pot with your crappy hand. I suppose you can go with the c-bet and just hope you get a fold. But make no mistake, if you get raised on the flop, you're committed and done. If you even get called on the flop, you're done. You have no more chips and your current chip stack will then be less than what is already in the pot before the turn card even comes out. You won't have enough chips to make any kind of a real, credible bet at that point in the hand. You're out. Your chip stack was barely big enough with 27 big blinds to be able to play any postflop poker at all.

Taking it a step further, let's reverse the scenario for a minute. Say you are in the big blind with your 27 bb's remaining, and the button raises your 40-chip big blind to 120 chips, and you have that 1060 chips remaining in your stack. Can you resteal here? Let's assume a standard resteal of, say, 3 times the steal-raise ahead of you. That means you need to put in 360 chips of the 1060 you have remaining, which again already is more than a third of your existing stack. Yes, you can resteal here, but that's it. Once you are called (or reraised), you don't have the chippage left to do anything credible at all after the flop comes down.

Looking at one more point, let's say the button raises to 120 and you opt to just call his 120-chip bet from your big blind, leaving you with 980 chips remaining to see a flop. Now you check the raggy flop and opponent does his standard c-bet of say, 160 chips into the 260-chip pot on the flop. You can't even really credibly smooth call this bet and hope to steal on the turn. To do so would cost you 160 chips of the 980 you have left, and would leave 580 chips in the pot to see the turn card. Then on the turn with 580 chips you have just 820 chips remaining. I guess you can play it this way, but once again you can't possibly put any moves on anyone credibly after the flop.

The overall point that Snyder makes so well in The Poker Tournament Formula II here is that it is crucially important to always maintain full utility, or as close to full utility as possible, in order for a skilled player to be able to really exercise all of his poker skills in a tournament. You can be the best player of all time -- Stu Ungar, Doyle Brunson, Hellmuth, Ivey, you name it -- but if these guys only have 20 or 30 big blinds at any point in a tournament, they cannot effectively exhibit that skill. They just can't. The weapons in the arsenal have been significantly diminished because their chip utility is so small at that point. Sure, Ivey may have a good read on you that you're bluffing. But if he can't credibly float-call you on the flop and again on the turn because his chip stack is simply not close to big enough to support such moves in a credible way, then he will not be able to anywhere near maximize the number of chips he can extract from you on that hand. Doyle may have a great read on you that you are just restealing a late position stealer preflop from the small blind, but if he has limped in from early position, he simply does not have the chips to re-resteal you in any credible way, in a situation where if he had 100 big blinds at the start of the hand he can be totally positive that he could get you to fold. But he can't get you to fold with just 27 big blinds sitting in his stack at the start of the hand.

That is what the theory of chip utility is all about. As I mentioned yesterday and as I will be writing about in future posts I am quite sure, the theory of chip utility is most interesting to me in the ways that it tends to call into question some of the previously (in my view, anyways) accepted views of very well-known and well-respected poker authors. I already mentioned above how Harrington's M analysis seems to grossly understate the number of big blinds you need in your hand to avoid being "desperate" in tournament terms. But when you think about chip utility from a "Gap concept" perspective, that entire way of thinking also is called entirely into questions in poker tournaments, something I may write more about next week. On Monday I am also planning to write a little about what Snyder calls "utility odds" as an alternative calculation to the totally-accepted notion of using "pot odds" or even "implied odds" when making call-or-fold decisions in tournaments. Snyder makes some brazen conclusions on the utility odds front, which I will discuss more next week and which I think ought to make a lot of you think hard about tournament poker, if you're the type of people looking to and open to questioning such things.

The overall point of today's post is to say that, generally speaking, you really need something close to 100 big blinds in your stack in order to have full chip utility, or the ability to easily and credibly use every type of move normally available in a skilled poker player's arsenal. Information bets, information bluffs, preflop resteals, re-restealing from restealers, float-calls on the flop, float-calls on the turn, check-raising the turn, bluff-raising the river, etc. 100 big blinds gives you the ammunition you need to credibly be able to make all the moves a skilled player can normally make in a tournament, while anything less than 100 bb's starts to eat away at the margins of this freedom to do whatever you want in a given hand. Typically it's the ability to make the later-street moves that disappears first, along with the reraising later in the hand, with the last thing to go normally being the preflop allin move. But the point to take away from this all today is that the truly skilled mtt players either subconsciously or consciously understand well this concept of chip utility, and they will do whatever it takes -- including making some often seemingly questionable decisions -- to try to get their stacks up to (or back up to) full utility as early in tournaments as they can, so that they can really open up their games and seriously disrupt the other players at their table.

More on this next week. Have a great weekend everyone, I am glad to be back writing here these days. Have you bought Snyder's books yet?