What is ICM in poker and how does it impact strategy in MTTs?

*Pot odds are the ratio of the size of the pot to the stake you need to call.

*Push is a bet for your entire stack (all-in).

Most often, such mistakes occur near the bubble* or at the final table, when the cost of elimination sharply increases. Players continue to think in terms of chips, even though the real decision should have already been made in terms of money.

*Bubble in poker is the stage of the tournament when one or more players need to be eliminated before reaching the payout.

This is where the concept of ICM in poker emerges. It explains why situations of equal strength require different decisions at different stages of the tournament, and shows how our stack's value changes depending on the payout structure and the opponents' stacks.

In this article, we will explore what ICM is, how it works in practice, and why understanding it is crucial for making consistent profitable decisions in tournament poker over the long term.

As you might have noticed, we used several poker terms that might be unfamiliar to you at the early stages of learning poker. To understand them better, we recommend referring to our glossary. 

Now, onto the topic. 

What is ICM

ICM (Independent Chip Model) is a mathematical model that allows you to assess the monetary value of your stack in a tournament.

It is important to note a key point straight away: ICM does not evaluate the strength of a hand or the probability of winning a hand. It evaluates how much your chips are worth in the context of the tournament.

In a cash game, everything is linear: one chip equals one monetary unit. In a tournament, this connection is broken. The value of chips becomes nonlinear and depends on the payout structure, stack distribution, and the stage of the tournament. 

A loss might mean elimination, which equates to losing all future potential. Meanwhile, winning does not proportionately increase the stack's value.

This leads to a crucial consequence: in tournaments, we cannot assess decisions solely based on the probability of winning a hand.

Sometimes the right decision is to abandon a chipEV decision to maintain your position in the tournament while waiting for a more advantageous pay jump. 

We delve into the difference between chipEV and ICM more in the article about stages in tournament poker. Feel free to explore it. 

ICM Formula: Calculating Stack Value

Formally, ICM is calculated using expected monetary value:

ICM EV $ = probability of 1st place × payout for 1st place + probability of 2nd place × payout for 2nd place + … + probability of nth place × payout for nth place

At first glance, this formula looks like a standard mathematical expectation, but in tournaments, it acquires a special meaning. We are not just assessing the chance of winning a hand — we are evaluating how the current distribution of stacks influences our chances of securing each prize position.

Let's consider a specific example. There are 5 players left in the game with the following stacks:

— 100,000
— 60,000
— 45,000
— 30,000
— 15,000

Payout structure:

— $2,000
— $1,500
— $1,000
— $500
— $200

If you look only at the number of chips, it might seem that the player with 100,000 should receive much more than the others. But ICM presents a different picture: his advantage is capped by the top payout — he cannot win more than $2,000, even if he has half of all chips.

To assess the real value of each stack, the model:

1. Determines the probability of each player securing each position

2. Multiplies these probabilities by the corresponding payouts

3. Adds up the result

In practice, this means:

— large stacks are undervalued relative to chipEV
— short stacks are overvalued
— the value of each subsequent chip decreases

This leads to the key ICM rule:

We should only call an all-in when it increases our $EV over the long term

If the call provides zero or near-zero expectation, it is better to avoid it. The reason is that the risk of elimination almost always costs more than the potential chip gain.

This is why, in tournaments, players often have to forego situations where they are favourites. ICM forces us to consider not only the probability of winning but also the consequences of losing — and it is this that makes the model a crucial tool for decision-making.

How much is a chip worth in a tournament?

Let’s consider a simple example: 

— 10 players at the table
— buy-in $10
— prizes: $50 / $30 / $20

At the beginning of the tournament, 1000 chips ≈ $10. But once in the prize positions, the situation changes. Even a short stack guarantees a payout, hence its value is already higher than at the start.

Now the opposite situation: you win the tournament and secure all the chips. The chips have increased tenfold, but the maximum prize is $50.

This means that:

— stack growth is not proportional to monetary growth
— each subsequent chip is worth less than the previous one

This effect is called the 'diminishing value of chips'. It forms the basis of all ICM decisions.

Imagine a situation: you have 60% equity against your opponent’s range.

In a cash game, this is an obvious call. In a tournament, everything depends on context. If losing means elimination and there's a player with a smaller stack who could be eliminated sooner, then folding may be a more profitable decision. 

The reason being, ICM considers not just the probability of winning a hand but also the consequences of losing.

Here, a loss means losing all future $EV. A win is merely an increase in stack, not proportional to money increase. 

ICM on the bubble and final table

The impact of ICM is most pronounced at key stages of the tournament.

1. Bubble

At the bubble, maximum pressure is exerted on medium stacks.

— short stacks are fighting for survival
— chip leader can exert pressure
— medium stacks need to play cautiously

It is here that situations often arise where even strong hands need to be folded to maintain position.

2. Final table

At the final table, the cost of mistakes increases even further.

The difference between adjacent payouts can be tremendous, and any wrong decision directly affects the tournament's final result.

At this stage, the game becomes highly sensitive to ICM, and ranges narrow significantly.

ICM pressure: how to take pots without showdown

ICM not only restricts but also creates opportunities.

A player with a big stack can exert pressure on opponents, as their risk of elimination is much higher.

This leads to:

— medium stacks folding more often
— call ranges narrowing
— aggression becoming more effective

Thus, ICM creates a situation where chips start to work as a tool of pressure, not simply as a resource for playing.

ICM drawbacks

Despite its effectiveness, ICM remains a model with limitations.

1. Does not consider players' skill level

ICM assumes all players are equal in skill. In reality, this is not true. A strong player might realize his advantage in future hands, thereby making his stack potentially worth more than the model indicates.

2. Does not consider future situations

ICM only evaluates the current moment. It does not account for future blinds, potential profitable spots, or table dynamics.

This could lead to overly cautious decisions if the model is considered out of context.

3. Ignores position and hand structure

A stack of 10bb on the button and in early position holds different strategic value, but ICM does not account for this. The model works at the level of chip distribution, not specific gaming situations.

On the other hand, these factors are not objective reasons to neglect the influence of ICM at the most critical stages of the tournament. Hence, our advice: it's better to consider ICM than to ignore it. 

ICM calculators

Since precise ICM calculations manually are practically impossible, players use specialized software to analyze hands and develop strategy.

1. Flopzilla

Available here.
Cost: $25 for a lifetime license. 

This is a tool for equity analysis and working with ranges. It allows modeling hands, setting hands, boards*, and observing how different ranges interact with each other on each street.

The main value of the program is developing range-based thinking*. The player stops perceiving the situation through specific hands and starts analyzing ranges, their intersections, and structure.

This directly impacts decision-making quality: it becomes easier to understand which hands continue, which fold, and how equity is distributed in different play lines.

*Board in poker refers to common cards on the table that are revealed for all players.

*Range in poker refers to all possible hands a player might have in a given situation.

2. Holdem Resources Calculator (HRC)

Available here.
Cost: starting from ~$15 per month depending on the tariff.
A trial version is available.

This is one of the key tools for tournament players, focused on decision analysis with ICM consideration.

The program calculates optimal push/fold ranges, analyzes hands at the bubble and final tables, and models various tournament scenarios considering payout structures and stacks.

The main advantage of HRC is its focus on tournament logic. Unlike universal equity calculators, here decisions are viewed through the lens of $EV, not just chipEV.

Regular use of HRC helps understand how ranges change under ICM pressure and where players lose money by making standard decisions out of tournament context.

3. ICMIZER

Available here.
Cost: $18 per month, $37 for three months, $100 for a year. 
A free trial version is available — 7 days with full access to all features.

This is a specialized tool for tournament players. It helps analyze push-fold decisions with ICM consideration and identify mistakes in played hands.

The program automatically suggests optimal actions, helping to quickly develop proper tournament thinking and reduce costly errors.

Conclusion

ICM in poker is the foundation of all tournament strategy. It changes the way we think: we stop evaluating hands based on their strength and start assessing them based on their impact on the final result.

This requires a deeper approach to the game, where every decision is viewed in the context of the tournament structure, not just a single hand.

Over the long term, this mindset allows minimizing costly mistakes, using pressure more efficiently, and making more accurate decisions in complex situations.

To learn the intricacies of understanding ICM, apply to FunFarm and embark on a professional poker journey with us.