ICM
Independent Chip Model: converts tournament chips into real prize money. Its core lesson: in a tournament, the chips you risk are worth more than the chips you can win.
In a tournament, chips aren’t money: they’re probability of prizes. The ICM (Independent Chip Model) does the conversion — it estimates what your stack is worth in prize-pool money by computing the probability that you finish in each paid spot.
The example that explains everything
Three players, payouts of 50/30/20. The stacks are 5,000, 3,000 and 2,000. Our engine (exact Malmuth-Harville) splits the value like this:
| Player | Chips | ICM value |
|---|---|---|
| Leader | 50% of the chips | 38.4% of the prizes |
| Middle | 30% | 32.8% |
| Short | 20% | 28.9% |
The leader holds half the chips but not half the money. Every chip you win is worth less than the last one — and every chip you lose, more.
The practical consequence
That curvature changes decisions: a call that’s profitable in a cash game can be a disaster near the bubble, because you’re risking expensive value to win cheap value. With the leader applying pressure, the middle stacks suffer most: they can’t fight the big stack and can’t afford to lose to the short one.
That’s why all-in ranges tighten on the bubble and at final tables. The ICM calculator gives you the exact value for any distribution of stacks and payouts; the course lesson teaches you to spot when the pressure is working for you.