There will be many times when a player is forced to decide whether or not they should call a bet that they face, or perhaps if they should raise or if it is time to concede the hand to their opponent. In most cases, the correct action for the player to take is determined by whether or not the math adds up to make the call. People use the math involved to determine whether or not this action is likely to be a profitable one in the long term, which is a simple calculation of pot odds.
Pot odds are determined by the size of the bet in relation to the pot as a whole. A simple example would be if the pot currently had 50 dollars in it and you were required to pay 5 dollars to remain in the hand, you would be getting 10/1 on your call. You can quickly determine the long term profitability of an action by determine whether or not the likelihood of your hand being made is greater than the current percentage of the pot it is to call. In our example to calculate the percentage you reduce the numbers to 10/1 and then add them to get 11 which from there you divide the cost of the call (the 1) by the sum (11) to get .09 or 9 percent. Therefore, if your hand was going to be made greater than 9 percent of the time, it would be profitable in the long run as you would have a positive expected value on your call.
The situations we have looked at so far tend to tell us what to do when we have to face calling a bet. Pot Equity looks at situations when we should decide whether or not we should be betting or raising in order to win a pot. In order to understand the concept of pot equity you are going to want to know the percentages of your hand winning in the long run, given every possible deal. Once you have determined your percentage of winning the pot you can compare that action to the price of the action in front of you. If for instance you had a hand that would win the pot 40 percent of the time from the current spot and the size of the pot was 200 the equity you would have is $80 (200*.40). If your equity is greater than the action in front of you, you want to be calling or raising as in the long run you have a positive expected value.