The Entertainment Value Of The Casino House Edge
Casinos offer a variety of choices in entertainment, accommodations, and opportunities for all levels of players. A casino uses its edge over the average player in order to provide the maximum entertainment experience. Providing the maximum entertainment value means no matter the experience level, the game, or the amount of the bet, the casino always retains the house edge over the player.
The casino's house edge is the payout based upon the statistical expected value of the variables for each game. Different casino games, and different bets, will each have separate expected values. In each case the expected value will always be stacked in the casino's favor.
An example would be the odds for the casino game of roulette. In American casinos, there are 38 possible outcomes of the roulette wheel. The odds of a player being able to beat the casino on a single outcome are 35 to 1. Considering the 38 possible outcomes for each bet, this means there are 37 chances the casino will win and only 1 chance the player will win. If the player actually beats the casino house edge, then they would receive $35 for each dollar bet.
So how does the casino actually calculate and use the house edge to its advantage? Based upon the same roulette example, the casino calculates house edge by taking the odds versus the expected payout. Using the following formula, the house advantage would be an expected payout of -$0.0526 for each dollar bet.
(-$1*house wins/possible combinations) + (Payout x player wins/possible combinations)
(-1*37/38) + (35*1/38) = -0.0526 (5.26% house edge)
In the casino house edge, the more negative the outcome means the better the house edge is. The casino house edge can be as low as -1.06 for games such as Baccarat, and as high as -27 for games like Keno. In most cases, the casino house edge is always stacked against the player. With the exception of some card games, statistical odds and expected payouts do not vary and the casino retains the house edge.
Card games like poker and blackjack are few of the games statistically the player may receive an advantage over the casino house edge. In each case, the number of card decks the casino uses, the player's skill level, and the specific game played will determine the casino house edge.
In the case of Blackjack, using a basic strategy will allow the casino to retain a -0.5% edge over a player. At the same time a poor or unskilled player will enable the casino to keep a house edge as high as -5%. On the other hand, a blackjack player skilled at counting cards will actually cause the casino to loose the house edge.
The casino house edge is also calculated to allow a profitable revenue for the casino while offering relatively few players the chance at a large payout. Essentially this is the marketing advantage of the casino. If the casino had a total house edge, players would never win and the casino would cease operation. On the other hand, if the casino house edge is always positive, it would never successfully profit and cease to operate. It is through balancing the casino house edge and the players risk level where the casino maintains its edge and maximum entertainment value is achieved.