Who has the Edge? Answer: The House
Posted on June 27, 2013 at 12:06pm
The concept of the ‘house edge’ is often misunderstood. In the simplest terms, the house edge describes the percentage of each bet placed that the casino expects to keep. It’s necessary for casinos to have a house edge so that they are able to operate and in most cases, the house edge is fairly low, hovering at around 6%. Even when the house edge is considerably higher, such as on Keno, players are still able to win big by betting big.
A Casino is a Business
When asked about their house edge the majority of casino operators simply reference the fact that, like shops and restaurants, casinos are businesses and must turn a profit for their investors and benefit the economy through job creation and business activity. The house edge is the average amount of money that is lost compared to the initial bet placed. Some games, such as Video Poker and Blackjack, don’t have profit built-in but many others do. Not only is the house edge the average of what you lose, but also the difference between the ‘true’ odds (what should technically be paid to you) and what the casino chooses to give you. Although there are several casino games on which the house edge is zero (and these are often pitched as attractive to players), a 100% payout on these games is only achievable through perfect playing technique over a long period of gameplay.
Different Games, Different Edges
The best way to explain the concept of the house edge differing game by game is through the popular casino game Roulette. Single 0 Roulette tables have 37 numbers and double 0 tables have 38, so the odds are pretty simple - either 1 in 37 or 1 in 38 respectively. However, win on a single number at Roulette and the casino will only pay out at 35 to 1 on both games; meaning that the house edge is 5.26% in double 00 Roulette but just 2.70% in single 0 Roulette.
Blackjack takes the edge off
There are casino games that defy the house edge - such as Blackjack and Video Poker. In these card-based games, the odds are constantly changing. When a card is dealt, it is dealt at random, meaning that the odds of the house or the player gaining advantage see-saw and card counters are able to win a lot of money.