knowin’ when to hold ’em and when to fold ’em is the key in playing rationally. The decision you make depents on your chances of winning the pot in relation to how much you must invest to stay in versus the total money in the pot.

There are four aspects you need to know to make a proper descision :

1. Pot Odds
2. Implied Odds
3. Reverse Implied Odds
4. Pot Equity

Pot Odds
This is a simple division of the money in the pot, and how much money it will cost you to stay in the hand. For example, if there is $20 in the pot, and it would cost you $2 to call then the pot odds are 10:1.

Pot odds aren't very important untill the turn and river.

Implied Odds
Implied odds is current expectation adjusted for future betting. This means it will certainly cost you more money in the coming rounds to stay in the hand.

With implied odds, the betting position plays a large role.

an example :

In your hand you hold Js Kh.

The flop comes : 9s Tc Qd

So, on the flop you hit an open ended straight draw. In this case you have 8 cards that will win you the hand (eights or aces) with a 4.75:1 shot on each card to come.

Lets asume you will only win the hand if you make your straight but will definitly win the hand if you get the straight.If you are last to act, the first player bets, the second player calls, and you are now required to invest $2 into a $10 pot. This is good because it is a 5:1 investment. But wait! This is in fact a 5:1 investment for a 2.375:1 shot at this moment. The reason this is so is because there are two more cards to come, so you get two chances at your draw. This does assume you’ll stay in until the river, but in this example, you will definitely win if you make the straight, so it would be hard to get you out. In a real game, you must fi gure out when it would be best to fold.

Reverse Implied Odds
Reverse implied odds show how a weak hand does not fare
well, even when it is ahead on the flop.

Lets take a look at the following example :

if, for example, you are in the big blind and three other players limp in).

You hold 8s 4d, and you get the flop : 8h 7h 3c.

There are so many ways to lose this hand that it’s ridiculous. You wisely check, and there is a bet behind you. Folding is certainly the best action.

Pot Equity
Pot equity is overall defined as "the dollar or bet equivalent to the
percentage of the pot that you expect to win. That is, if the pot contains ten bets, and you have a draw to the nuts that will come in 20 percent of the time, your pot equity is two bets"

They isolate three areas in which this information helps a player decide on the best course of action :

* Pot equity tells you how much you are giving up if you fold. With 10 bets in the pot, you have a draw that will win you the pot 5 percent of the time. If you must call one bet to stay in, pot equity dictates that you fold, as your equity is only 0.5 of a bet.

* Pot equity helps you decide whether or not to grant a free card. In this case you must add together all your opponents’ combined pot equity. If you are heads-up against a player you believe has an open-ended straight draw to beat you, you must decide if the player will pay you off more in the long run, after granting them a free card on the turn. In other words, if you know they’ll fold on the river
if they miss their straight, you need to make them pay to chase their draw.

* A strong drawing hand gives you a large amount of pot equity. For example, with the nut flush draw after the flop, you will have a slightly better than 1/3 chance of making your flush. While it will sometimes lose to a full house or better, that’s life. With four opponents, the authors note, you are putting 20 percent of the money into the pot for a 35 percent chance of winning. You are operating at a 15 percent advantage. Get your money in the pot!