UNDERSTANDING THE HOUSE ADVANTAGE
When learning about online casinos, one often comes across the terms “house edge” or “house advantage”. It is important to always remember that the casino is a business, and it is designed to earn money. It does this by making sure that over the long term, the casino always wins more than it loses.
This means that the odds are always in favor of the casino. In fact the phrase, “the house always wins” is a cliché that everyone has heard by now. The assumption that most players make is that if they wager a certain amount on an even money wager, they will receive that amount of money back plus the same amount on top. This is the draw. However, say a casino has a 1% global house edge, then when one wagers the same amount on an even money bet, the true return in the long term will be exactly 1% less than even money. To clarify the example. Assume the wager is $100 on the even money bet. A winning player will receive $200. However, if that player continues making the same wager for a long time, the net result of the wins and losses will eventually yield a result closer to $99/$100.
How is this possible? It is built in to the win/loss payout ratio—the math of the game—and is invisible to most players. So what happens is that people playing in the short term are happy. They win or lose exactly what they expect to. It is only in the long term that the house advantage becomes visible. This advantage is what permits a casino to stay in operation. It is unbeatable.
There is good news, however. The advantage does not operate on the short term, but instead only become apparent over a very long time. This means that people certain people will be very lucky and manage to win a lot of money. The house advantage does not affect everyone at once, especially over the course of one evening. Casinos are constantly moving money from the many to the few, and taking a cut in the process.
The house edge is different for every game, and it is often directly related to how big the payout or jackpot is. Thus slot machines with massive jackpots have higher house advantages, whereas blackjack games with simple payout schedules have the lowest house advantage of all.
Players should not be deterred if a game has an unfavorable house advantage. The reward can be high, and people do win. In casinos, the risk is proportionate to the reward. Take a chance and see the house advantage at EuroPalace Casino.