How to Calculate a Casino’s House Edge and Variance
A casino’s house edge (also known as the house’s advantage) grinds the player into unprofitability. The lack of windows and clocks at casinos is a deliberate design feature to make players lose track of time. Many casinos give away free drinks to players, a welcome surprise for first-timers. However, players who are intoxicated do not have better judgment when placing bets. For this reason, players must avoid taking drinks in casinos.
Gaming mathematicians and computer programmers perform this work for casinos to make their games more profitable. They also calculate variance and house edge to determine the cash reserves of each game. This work is done by casino mathematicians and computer programmers, but many casinos do not have in-house experts in this field. For this reason, they outsource the work to outside companies that specialize in this area. In order to provide the best service to players, these facilities use sophisticated software to monitor the outcome of every game.
A casino’s house edge and variance are important to its overall strategy. These figures tell the casino’s expected payouts, or profit percentage. These numbers are crucial for the casinos to calculate their cash reserves, as they can never lose more than they can afford to. This means that a casino is unlikely to lose money on any particular game. Even so, casinos sometimes give extravagant inducements to big bettors. These incentives include reduced-fares transportation, free cigarettes, and free drinks.