Cash games vs tournament poker - relative chip value

Bloggers / Matthew Pitt / 09 January 2009 /

On the surface, cash games and tournament poker look very similar. After all, the hand rankings are the same, each player has a stack of chips and everyone has the potential to win some money. However, the two disciplines have some fundamental differences that set them apart.

The main difference is that tournament players need to be aware of the fact that their chips have a differing value but the value of a cash game player's chips remains constant. Whilst this sounds absurd, it is 100% true. If you sit down with $50 at a cash game and after a couple of orbits you decide you do not want to play so cash out your stack, you will receive $50, minus the blinds if you paid them.

But if you and nine others enter a sit and go with the standard 50%/30%/20% payout structure and exchange your $50 for 2,000 in chips, each chip would be worth $0.025 ($50 buy-in divided by 2,000 chips). However, if you win the tournament, you will hold each of the 20,000 chips in play and will be awarded $250 in prize money which gives the chips a value of just $0.0125 each! ($250 prize divided by 20,000 chips)

The fact that the chips change in value really sets apart cash from tournament play. The chips at the top of a tournament player's stack are worth much less than the last remaining chip. Imagine if you had a stack of 10,000 and lost a single chip, you would still have 9,999 left so it would not really matter in the grand scheme of things. But suppose you only had 1 chip left and lost, it would be disastrous as you would be out of the tournament; therefore more value is associated with your last remaining chip.

A tournament player needs to be aware of the chips' value fluctuations as making calls and raises later in the game is more costly than at the start or early stages of the contest.

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