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What is House Edge in Casino and What Does It Mean For Your Winnings?

February 4, 2025 73 0
What is House Edge in Casino and What Does It Mean For Your Winnings?
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The house edge is the mathematical or statistical advantage that casinos have over players in every bet placed. It represents the percentage of each wager that the casino retains as average gross profit over time. Unlike player winnings, which fluctuate based on luck, the casino’s profits are predictable due to this built-in advantage.

What is the House Edge Rule?

The House Edge Rule refers to a casino's built-in mathematical advantage over players in every game. It ensures that, over time, the casino consistently profits from all bets placed, regardless of short-term player wins. This built-in edge is a fundamental aspect of casino games and is expressed as a percentage of each bet that the casino expects to keep as average gross profit. House edge varies depending on the game: 

For example, the house edge rule can be applied as follows: 

  • In American Roulette, the house edge is 5.26% due to the double zero on the roulette wheel.
  • In European Roulette, the house edge is lower at 2.70% since there is only a single zero.
  • Slot machines have a varying house edge, typically between 2% and 15%, depending on the game’s random number generator and RTP (Return to Player). 

Yes, even high-RTP games have an inherent house edge. RTP and house edge are inverses of one another. For example, if the player bets on a game with a 10% house edge, the RTP is 90%.

The House Edge Rule ensures that the casino house edge remains consistent over thousands of bets, making the odds stacked against the player in the long run. However, certain games, like blackjack, allow for optimal strategy, which can reduce the house edge significantly.

Understanding this rule helps casino players make informed decisions about which games offer better odds and how to manage their bankroll effectively.

Understanding House Edge: How is the House Edge Calculated

Various games have different house edges, depending on the game rules and the probability of winning each bet. For example, in American roulette, the game features a double zero, which increases the casino house edge to 5.26%, compared to European roulette, which has only a single zero and a lower house edge of 2.70%. The formula for the house edge is:

House Edge=(Expected Value−Original Bet)/Original Bet×100

This calculation helps players make informed decisions on which games offer better odds and where the odds are stacked against them.

How House Edge Works in Different Casino Games

The house edge applies to all casino games, but it differs based on their structure and payout mechanics. Here’s how it functions in some of the most popular casino games:

  • Roulette Wheel: In double zero roulette (American), the higher house edge of 5.26% means more money lost over time compared to European roulette, which has a lower edge of 2.70%.
  • Slot Machines: These games have some of the highest house advantage rates, ranging from 2% to 15%, depending on the random number generator and RTP.
  • Table Games: Games like blackjack allow for optimal strategy, reducing the house edge to as low as 0.5% with optimal play.
  • Caribbean Stud Poker: This game carries a higher house edge, typically around 5.22%, unless players use optimal strategy.
  • Sports Betting: The casino expects a built-in commission (also called vigorish), usually around 4.5% to 10%.

How to Beat the House Edge: Strategies to Minimize the House Edge on Popular Casino Games

While the house edge represents a casino’s long-term profitability, certain betting strategies can help players play longer and manage their bankroll effectively:

Choose Lower House Edge Games

While most casinos always have the mathematical edge, you can still increase your chances of winning. Games like blackjack, baccarat (banker bets), and certain poker variants offer a low house edge. In such cases, it’s best to look at actual odds to gauge your probability of winning. 

Avoid High House Edge Bets

Some wagers, like single-number bets on a roulette wheel, have a more significant house edge and reduce the probability of a gambler’s win.

Use the Right Betting Strategy

In craps, a pass line bet with odds has a 0% house edge, making it one of the best bets in the casino.

Play at Online Casino Games with High RTP

Most online casino games list their return-to-player (RTP) percentages, making it easier to select games with lower edges.

Final Thoughts: Making Informed Decisions While Gambling

Understanding the casino edge helps players make informed decisions about where to bet and how to approach gambling responsibly. Whether you prefer online slots, playing American roulette, or other casino games, knowing how the house edge works can impact your experience. Now that you know why the casino wins no matter what the dealer hits—it’s because of this house edge. 

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