The house edge is the percentage of the combined bets placed that the casino expects to retain over a period of time. Casinos don’t pay out at the true odds of winning a prize, instead setting the amount slightly lower to guarantee they will be in profit in the long run.
The clearest example of this is with European Roulette, which contains 36 numbers and a zero, making 37 potential outcomes, with the payout for matching the right number standing at 35/1. If you were to place a chip on every square, only one could win, so you would lose 36 chips and receive 35 as a prize to add to your original stake. The casino has taken in one chip more than it has paid out, and this is the house edge.
Obviously it is unlikely that anyone would bet like this, but over time, the principle holds that the casino has an ingrained advantage in order to fulfill its duty as a business and make money.
You can calculate the house edge for European Roulette as a percentage by dividing the loss shown in the example by the amount bet:
1/37 = 0.027 = 2.7 percent.
The lower the percentage of the house edge on a game, the more chance you have of winning, although, of course, with a game like roulette, that is all down to luck.
Keno is well known for having a large house edge, often reaching up to 40 percent depending where you play, whereas Craps can offer a house edge of just 0.021 percent depending on the rules in played.
The house edge on blackjack can fluctuate based on decisions made by the player, and a knowledge of basic strategy can give you the strongest possible chance of winning a hand. There is a strategy table available at the How to Play Blackjack page which can help you make the most logical decisions, although it cannot guarantee that you will be successful every time.
In the UK, it is a requirement from the Gambling Commission that casinos display house edge information, so make sure you familiarise yourself with it when you visit a venue. These details are often presented as a Return to Player (RTP) amount, particularly at online casinos. For example, if the house edge on European Roulette is 2.7 percent, the RTP will be listed as 97.3 percent.
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