In any form of gambling if you work out the odds you’ll be able to work out the expectations in any game. These can be split into two general types – negative and positive expectations. They refer to the specific advantage that either the house or the player has in any specific game. The actual advantages vary from game to game, but in nearly all situations the house has a positive expectation (expects to win) and the player a negative expectation(expects to lose). It sounds kind of depressing, but it simply represents the reality that the casino will only set up games where it has a slight advantage and so an expectation to win.
It’s the same in all sorts of gambling really, even buying a lottery ticket there is a negative expectation of winning. However fortunately these only refer to the long term and in the short term huge fluctuations can occur with a player winning much, much more than they lose.
So what is the biggest threat to a casinos profit and loss account?
Well the one thing that really makes a casino manager sweat isn’t the sophisticated casino systems or tactics but the Big Bet! Not the hundreds of dollars level but the really big bets which perhaps are $10k plus. You might think this is the casinos dream, some sucker placing huge bets and blowing all their money in half the time. But it’s not true because the expectations are only realised in the long term, in the short term anything much can happen. We’ve all seen streaks of luck that defy logic and the laws of probability and so have the casino managers many times. They know strange things can happen in short periods, by far the safest way to win money is to slowly extract it over several hours from the player. Not only is this safer but the player also gets some entertainment from the game which is likely to bring them back.
But if some punter starts throwing around big bets and get’s lucky then they can win some serious money, very, very quickly. With small bets the casino will relax and wait for matters to even themselves out, it might not happen in the short term. It’s precisely this reason that the casino will set a table limit on most tables across all the games. The limit is set to protect the casino not the other way around, they really don’t want to see some high roller stroll up and place massive sums on an even money bet – after all they may well lose.
I remember a story circulating a few years ago about a gambler from Japan who was visiting Atlantic City. He was a serious high-roller and always bet really big, usually playing roulette or Baccarat. Well apparently in his first two days he was up by about $2 million mainly from Baccarat. All from one casino who started to get cold feet and were considering ending the game with this individual. However a statistician informed them as long as the man continued to play then he would eventually lose – simply because Baccarat has a negative expectation for the player (although only a slight one).
True enough, the gentleman continued to play and bet big and a few days later was down by $2 million instead. He even went back to the same casino a while after and allegedly lost another $10 million. If the casino kept it’s nerve and had the capital to ride out these ‘streaks’ then they would always win in the end.
It’s an important point to remember though irrespective of what level you bet at. If you play for too long you will lose, short term fluctuations can make players a lot of money but if you don’t leave then it will all go back eventually. Try and test it on this free casino game, whenever you keep playing you’ll always lose eventually and often it doesn’t take that long! There is one other thing that worries the casinos and that’s when the player actually manages to achieve a positive expectation, which I’ll cover in my next post on this site.