If you were looking for the most straightforward response to the question “How do casinos make money’ it would be that all casinos profit from the house edge. This is all there is to know, and no matter where you play casino games, you cannot avoid this truth. The casino always has greater winning odds than you do, which is what the term “house edge” refers to. Although it may seem unfair, casinos have always operated in this manner. The house edge is a long-term average that doesn’t significantly impact your short-term play.
Instead, it’s calculated over extended time frames like weeks or even months and thousands of wagers. As a result, your odds of losing money increase the longer you play. With a lucky game, anyone can win a sizable sum. But over time, the house always prevails and receives its percentage.
In light of this, let’s examine how casinos generate revenue from various games depending on the house edge.
How Do Casinos Make Money from Blackjack ?
Blackjack appears to be a game in which the house cannot have an advantage. In fact, it appears to be a game where an expert player may get an advantage over the house by merely understanding how to play his cards.
After all, both the player and the dealer have the same odds of getting different cards.
Every time a player accumulates a 2-card total of 21, they are rewarded 3 to 2.
Actually, it’s simpler than you may imagine. Because the player must play his hand before the dealer, blackjack has a house edge.
Before the dealer deals her card, if your hand busts, you immediately forfeit your chips. You lost your money, even if the dealer declares bankruptcy. For the casino to turn a profit, that benefit alone is sufficient.
Even with a perfect basic approach, you will probably lose about 30% of the time.
Even if the casino loses, your wager is already lost.
The fact that you are not even allowed to play your hand if the dealer gets a natural gives the casino an advantage. Having a natural is your only chance, and it’s used as a push. You can’t win or lose money in the situation.
Making Money from Craps
Craps is praised for being exciting and providing a variety of wagers.
However, all bets at the craps table pay out less than the odds of winning, with the exception of one. The odds bet, which pays out at true odds, is the only wager in which that isn’t the case.
However, you must first wager on the pass line or the don’t pass line in order to make that wager. (Or, you could say, come or don’t come.)
Although those are the strongest wagers at the craps table, the house still has a 1.41% or 1.36% advantage. The odds of winning are not the same for the other craps bets, which makes them all much worse and profitable for the casino.
Here is an illustration of a craps wager along with its chances of winning and payout:
The “any 7” wager is a single-roll bet that the next dice roll will result in a total of 7.
There is a 5 to 1 chance that wager will succeed.
4 to 1 are the odds.
How Do Casinos Make Money From Roulette?
Roulette is my favorite example of how probability functions, especially in relation to casino games and the house edge. The game is also simple.
You have a rotating wheel with 38 potential outcomes. The pockets of this wheel have the numbers 0, 00, and 1–36. The 0 and 00 are both green. The remainder of the numbers from 1 to 36 are red, with half being black.
There are many different roulette bets you may make, but they all have the same house advantage. (Apart from one wager, which I’ll also describe here.)
The simplest and most successful bets are even money wagers. These are the wagers where a $100 wager returns $100 in winnings.
An even-money wager is one that is placed on the color red. You have an almost 50% chance of winning this wager because nearly 50% of the numbers are red.
However, because of the 0 and 00, the wager does not pay out at the same odds as the likelihood of winning.
There are 38 potential outcomes, of which 18 are red. The equivalent is 18/38, or 47.37%.
In a statistically ideal set of 38 spins, you would win that wager 18 times out of 38, but you would also lose it 20 times. When you spin the wheel and win, you make $1800, but when you lose, you make $2000. Your net loss would be $200.
That would result in a loss of $5.26 every spin if you multiplied it by the quantity of spins.
On an American roulette wheel, all wagers are settled at odds that, without the 0 and 00, would result in a break-even situation.
I hope this article has helped you understand a little bit more about how casinos make money.
More importantly, we hopefully succeeded in educating you on the reality that the odds are always stacked against you because the payouts are smaller than your chances of winning. Yes, gambling may be a good time. But if this guide’s statistics and examples have taught us anything, it’s that you should only gamble with money you can afford to lose.
The house advantage cannot be eliminated and is the primary factor in why most gamblers lose more money than they win. Although regrettable, this is nonetheless a part of the business. Casinos exist to generate revenue. In contrast, gamblers who deposit money into a casino wish to be the fortunate ones to win the jackpot.