Limit Hold’em lends itself to a rather small edge – that is to say, you are limited by how much you can bet, so new fish are protected against making stupid moves like calling all-in with a bottom pair when you hold a top set. Think about it in mathematical terms: The bets are a mere fraction of the pot. So usually you will see people call with a solid draw, they have good odds for the draw. Suppose for a second that you are playing a $1-$2 limit game, with no rake.
Three players besides you and your opponent all see the flop. You bet and he calls through the river. Now, how much did your opponent expect to lose? Excluding the expected pre-flop loss, your opponent didn’t expect to lose that much. The pot going into the flop was $5. He called $1 so the pot was $7 after the flop. He then called $2 so the pot was $9 going into the river. Let’s see how much your opponent lost in terms of expected value on each of the post-flop streets. His expected value is his expected win, minus his bet.
Flop: $-.55
Turn: -$1.41
River: -$2
Total: -$3.96
While he actually lost $5 on the post-flop betting, he only expected to lose $3.96. So really, for every dollar he bet, he lost $0.79. Make a mental note that this is one of the worst possible situations in fixed-limit Hold’em. Rarely is one dominated in a small pot. Most of the time when people make incorrect bets in limit hold’em, their losing edge is much much smaller.
If this hand was played in a no-limit hold’em game, your opponent would have lost a lot more money. Your edge over him in terms of expected value would also have been much greater. This is because your bets are a larger fraction of the pot. Assuming pot-sized bets were made beginning at the flop, this is the amount in terms of expected value that your opponent would lose:
Flop: (bet of $5):-$4.04
Turn: (bet of $15): -$12.06
River: (bet of $45): -$45
Total: -$61.10
Now he made bets totaling $65 and expected to lose $61.10. Not only did he lose additonal money, but he also expected to lose an even higher percentage. For every single dollar he bet, he expected to lose $0.94! Well, that is a much bigger edge than the one in fixed-limit hold’em, because the bets are a larger fraction of the pot.
So, does this mean that no-limit ring games are superior to fixed-limit ring games? No, not necessarily. Because the edges can be so huge in no-limit games, most players tend to stay away from them unless they are good at playing no-limit hold’em, especially at higher stakes. Even poor no-limit players are wary of betting their money in situations like the one above. People will not throw their money away in situations where they expect to lose 94 cents on every dollar which they bet, while they would lose 79 cents on the dollar in a Limit game. At no-limit hold’em, being caught as a huge underdog in a big pot has disastrous implications, so few people who survive to play no-limit hold’em make such critical errors. None the less, poor players will tend to stay at limit hold’em and continue to lose their money, slowly.
