I see this term from time to time and am curious to know exactly what it means. On CVCX it is defined as "the value of a wager".

In the "Hot Shoe" DVD Andy Bloch from the MIT team mentions "certainty equivalent" when talking about how the players are paid. He says something along the lines of after a playing session a player would find the EV for various hands via SIM, then subtract the variance to calculate the certainty equivalent. In this fashion players are paid based upon the CE that they generate. So this way players were encouraged to make money and reduce variance at the same time. Does that make sense?

The other time I see it used pertains to indice numbers. For example, splitting 10s if the certainty equivalent is 4.

Does this term have several meanings or am I missing something? Thank you for clarifying.

-MJ