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Spending

How Much of an Edge Does the House Have in a Casino?


If you’ve been in a casino, you may have noticed that the odds are not in your favor. To understand why this is true, we must understand how casinos make money.

If you’re going to gamble, you may as well learn everything about it. Casino games are designed to give the house an edge over the players. If you play long enough, the casino will always win more money than you.  That’s how they stay afloat.

What is the House Edge?

House edge is the casino’s advantage over players. It measures how much money they expect to win compared to how much they are betting. House edge is calculated by dividing the casino’s theoretical win by the total bets. For example, if there were $1 million in total bets and the casino won $1.3 million, their house edge would be 30 percent ($1.3 million / $1 million).

How does the house edge affect the players?

The higher the house edge, the more likely players are to lose. Conversely, the lower your house edge, the less likely players are to lose.

Imagine the game is Blackjack with an even-money payout and a 10% commission charged every time you win.  That means every time you lose, you take a full loss.  And every time you win, you take less than a full win.  If you have the same number of wins as losses over time, it means you walk away a loser.

Sure you might have streaks of wins, and that is why a lot of people gamble.  But over time, the house edge makes it hard for individual gamblers to win.

Why do casinos have a built-in house edge?

They’re in the business of making money. They have to pay all of their expenses, of course, which include:

  • Employees and staff salaries
  • Taxes
  • Building maintenance costs
  • Equipment such as gaming tables, slot machines, and other casino equipment

What are the odds of winning in a casino?

The odds of winning a casino game depend on the game itself. Some games have a higher probability of winning than others.

In general, slot machines offer the best odds for players (though don’t expect to walk away with millions). Blackjack has an average house edge of 1% and can be beaten by skilled players. Especially those who know how to count cards or use strategy cards to reduce risk. Video poker tends to have a low house edge as well. It all depends on which variant you play!

Why do players lose more than expected?

If you’re a player losing more than expected, the problem may be with something other than the game itself. Your expectations may be wrong.

There are many reasons why players might lose more than they expect:

  • They need to understand what makes up the house edge (the effect of rules and odds on their chances of winning).
  • They need to learn how probability works (the different ways that things can happen).
  • They are playing games where luck plays a significant role in determining who wins or loses, so it can seem random how much money people win or lose from one session to another.

Casinos hold the highest edge on games with a low house edge and high volatility. The reason for this is simple: the higher the volatility, the higher the house edge. And if you’ve ever been to Vegas and watched someone throw down $100 on a single hand of Blackjack or roulette, then you know why casinos like these games so much.

Why do people gamble if the house always wins?

The house always wins in the long run. It’s a fact that you’re well aware of, but for some reason, your brain still wants to believe that it can beat the system. You want to say that you won—or lost—against all odds. And who knows? If you play enough times, your luck will change, and you’ll become the next rich jackpot winner!

There are many reasons why people gamble: they like the thrill of risk; they like being entertained; they like being part of a community; or even just because it’s fun! However, the most common reason people gamble is that they think there’s an edge on their side and are hoping for big wins once in a while.

Game Comparison & Recommendations?

Although Blackjack is the most popular game in the casino, there are better games. You could make as much money on keno or baccarat with a bit of luck. Roulette is a better bet than Blackjack, especially if you’re willing to spend some of your money on numbers that are less likely to come up (and therefore increase their odds).

Video poker and slots provide similar experiences: both allow players to be entertained while they wait for their hands to turn into something better. 

Blackjack: 0.5%

It’s no secret that Blackjack is a game of skill if you take the time to learn how to play it correctly, your chances of winning increase exponentially.

On average, the typical American casino offers a 0.5% house edge on all bets placed at its tables (or $0.50 for every $100 wagered).

Craps: 0 – 16.67%

Craps is a game with a higher house edge than any other casino game. The house edge can be between 0% and 16.67%, depending on the game’s specific rules. In some casinos, you’ll find that the casino has an advantage of more than 30%.

Caribbean Stud: 5.22%

Caribbean Stud is a game of skill and chance, with a house edge of 5.22%, played with two cards and a dealer.

Hold ’em: 2.36%

The most popular poker game in the world is Texas Hold ’em. The house edge for this game is 2.36%. This means that for every $100 you wager on this game, you can expect to lose approximately $2.36 if you play perfectly.

Baccarat: 1.01% – 15.75%

Baccarat is a game of chance, which means that the odds are not in favor of the player. The house edge is 1.01% on the banker and 1.26% on the player side bets, which makes this game one of the casino’s most profitable games overall.

American Roulette: 5.26%

While the original roulette wheel has a single zero, many US casinos now offer American Roulette. The main difference between European and American Roulette is that each number is assigned two pockets on the wheel. The house edge on this game is 5.26%.

Video Poker: 0.46%

Video poker is an excellent game for the player. The house edge is low compared to others — only 0.46%.

Slots (online and land-based): 2.8% – 15.8%

Slots are the most popular casino game with the highest house edge, payout, and volatility. They also have a high return to player or RTP. The house edge can range from 2.8% to 15.8%, depending on which slot you’re playing, but most fall around 10%. This means that for every $100 you bet at slots over time, you’ll lose about $10 in profit.

That’s why players do not typically play slots for extended periods; they’re expensive games that drain your bankroll quickly if you’re not careful with them.  They might be fun to test your luck for a few spins, but if you are planning to earn income by continually playing slots, you’ll likely be in for a short-lived career.

FAQs

What is the lowest house edge I can get at a casino?

The lowest house edge you can get at a casino is 0.5%. That’s not just a little lower than the average casino but also about half of what most casinos charge. You’ll find this number in games such as roulette and Blackjack.

Does the house edge apply to online casinos?

Before we talk about the house edge in online casinos, let’s first talk about the house edge in offline casinos. The house edge is a term that applies to all games of chance, whether you’re playing at an online or offline casino. The only difference between online and offline casinos is that online casinos can be run from anywhere in the world with an internet connection and no physical location. The local laws do not apply to offshore gambling sites (e.g., if a customer wins money at an illegal offshore gambling site). This may make some customers think that they are getting better odds. You can’t affect how much money your opponent has in their bankroll or how experienced their players are regarding luck versus skill as an individual player.

Tip: If you want better odds at any type of game (whether it’s live Blackjack or video poker), then make sure you’re playing with friends who are equally capable of making good decisions based on what’s happening at both tables.

How to reduce the casino’s house edge?

For games that are based strictly on chance, there is no way to overcome the house edge.  For games where skill or strategy is involved, then you have to become an expert at the game to even have a chance.

It might be a better bet to put your resources into something where the odds are in your favor, like making money in the stock market.  There is a lot of data supporting investing strategies where the edge might be in YOUR favor, not someone else’s.

 

Conclusion

So, what does all this mean for the player?   Well it means that it’s very unlikely that you’ll be able to make a career out of playing at a casino, because long term the house has an edge built in. 

Remember that gambling might be better as something fun to do and shouldn’t become an addiction where you’re putting more money into slots than what comes out of them.  If you go to a casino, you can think of it like you’re paying for an experience rather than expecting to earn money.

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Atif Munawar

Atif is a tireless knowledge seeker who often finds himself on the last page of Google. He's also one of those rare people who is a graphic enthusiast with a background in accounting.
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The content on Cashblog.com is for informational and educational purposes only. It is not financial advice and we are not certified financial advisors. Cashblog.com strives to keep its information accurate and up to date, but it may differ from actual numbers. We may have financial relationships with companies listed on our site. We may receive compensation for the placement of sponsored products or services. We work hard to write authentic and accurate articles.