How House Edge Works at Casinos
Everyone knows that casinos always win in the end, though the details of exactly how and why they can do this are often shrouded in mystery. This article explains the mechanism behind this, and what you can do to help swing the edge back in your favor (a little).
First of all below, the mathematical concept of house edge is discussed, along with some examples of how this has an outsized effect over time. After this, some differences between the house-edge in different games is covered. This will help you choose the games with the lowest edge in favor of the casino. Next you’ll find some alternative ways you can minimize the take of the casino from you.
Overview of House Edge
The percentage edge in favor of the house looks tiny when you see it written down. This is between 1% and around 5% for most games, though some side bets are higher than this. Many people ask how can a tiny edge allow the casinos to make so much profit?
There are two parts to answering this. The first is the sheer volume of play that happens in casinos, with billons being turned over country-wide every year, even a small edge turns into a huge profit in the end. The second answer involves looking at just how much you are turning over on every hand.
Here is a simple example to demonstrate using a made up Blackjack variant with a 2% house edge. This game gets 50 hands per hour. You are playing at a $10 table, though due to doubles and splits, you end up betting an average of $15 per hand. You are turning over 50 x $15 per hour, which is $750 in this game. That tiny 2% house edge has turned into $15, in a typical 3 hour session, everyone at the table will have ‘paid’ the house $45 (and it could be 5 players). This is before tips, and regardless of whether you are winning of losing over time.
This example used a 2% edge, many other games have an edge closer to 5%, if we use the same $750 turnover - this is $37.50c per hour you are paying to the house over the long run.
High and Low House Edge Games
Different casino games have a house edge which is higher or lower. Remember you should also take into account the number of hands of each game that you are playing each hour when calculating this.
The lowest house edge games you will find in most casinos are Blackjack and Baccarat. By using card counting, you can even turn the house edge into your favor playing Blackjack. I do not recommend trying this, as the most likely result is that you’ll be banned from that casino. The best Blackjack games have a house edge of just 0.5%, with the average games between 1.1% and 1.6% - this depends on the details of the splitting and doubling rules, as well as the number of decks used. Baccarat has a house edge of around 1.1%.
Roulette has a house edge of 2.7%, you only get this lower score if you choose the European wheel. If you instead go for the US wheel, then you are giving the casino a massive 5.3% advantage. French Roulette is even better, though the exact edge you can get will depend on how many even money bets you make.
Casino Poker is quite variable, games like Let It Ride, Mississippi Stud and Ultimate Texas Holdem are clustered around the 3% house edge mark. Caribbean Stud is worse, with a house advantage closer to 5%. Slot games are also between 3% and 5%, though you should remember that the games with big jackpots are considered higher variance.
The real traps in any casino are the side games which come with popular table games. One example is the ‘Insurance’ bet in Blackjack, this has a 12.5% house edge. Progressive jackpot bets and specials like ‘perfect pairs’ can be even worse, some give up 17% to the house every time you make them.
Keeping the House Edge to a Minimum
Selecting the games with the lowest house edge is a great way to keep the casinos profits to a minimum. You should also make sure you avoid side-bets where possible. If you must play these, then keep the bets to the minimum allowed.
Remember that casinos make a lot more of their money from players making mistakes in their play, rather than the true house edge. Taking the wrong cards in Blackjack (for example) can quickly bump the house edge up to 5% or even more.
Finally, remember to take advantage of any comps and extra bonuses offered to you by your casino. These can help offset the money they take from you over the long term.