Gaining an Edge Over the House
The Holy Grail of casino gambling is somehow gaining a mathematical edge over the house. Question is can it be done? More specifically for online play…can it be done playing at Internet casinos?
Ask your typical online system seller and they’ll tell you sure, you can beat the casino. And they’ve got just the system to do it. For $59.95 you get all the details; the roadmap to riches; the secret all casinos are scared of.
But then you have to ask yourself, why is this dude trying to earn a living selling the system rather than just using it to make truck loads of cash? And how secret can a system be if it’s for a sale on a website that’s been SEO’d to the nth degree? And while we’re asking questions, why aren’t casinos going broke at hands of players armed with these sure fired systems?
Could it be they’re a sham?
Could it be casinos can’t be beaten?
What’s House Edge?
If a casino game has a house edge, then in the long term it will result in more money being won than lost by the house. House edge is a function of the probability of a given outcome and the payout attached to that outcome. The easiest example to use is always the toss of a coin.
The probability of the coin landing on heads is simply 1 chance in 2, or 0.5. Now let’s say the casino pays even money (1:1) for a correctly chosen heads or tails outcome, so you double your bet if you win.
The expected value of the bet is (-1 x 0.5) + (1 x 0.5) = 0, which means there’s no house edge.
Let’s say the casino only paid 0.95: 1 for a win.
Now the expected value of the bet is (-1 x 0.5) + (0.95 x 0.5) = -0.025, or a house edge of 2.5%. If you were to place 100 $1 bets on this game, chances are you’d finish $2.50 down.
You can see this approach applied to roulette returns here.
This is how all casino games are designed, whether by card, dice or spinning wheel – with payouts set so that, based on probability of outcomes, in the long run the casino will take more cash than it gives.
Beating the house edge
Be very careful here, especially when being told a house edge can be beaten. In games involving independent events (like a toss of a coin, or roulette wheel) unless you have identified a physical defect in the wheel or coin gaining a house edge is impossible. Forget about any systems you’re being told about.
You can minimize your house edge by choosing games wisely. For example play European roulette rather than American roulette where odds of a hit are longer due to an extra pocket (00) on the wheel.
Even for games where you are betting on dependent events, like blackjack where the deal is from a depleting deck, methods designed to leverage this dependence (eg card counting) are usually countered by casinos so that they are ineffectual.
Word to the wise. Play only with what you can afford to lose. If you do win…take your money and run!