Looking at the Missouri Gaming Commission report, I see the 12 casinos in the state had 40 million admissions – even the two smallest casinos had more than 800,000 admissions each.
The two smallest casinos had gambling revenues of $34 million and $36 million. That’s just revenues on the gaming floor. The gaming commission doesn’t care about the liquor receipts, the attached hotels, all-you-can-eat buffets, etc.
some places have “riverboat” casinos. But they don’t have to be on the river or on a boat. Most are just buildings near a major river.
It wasn’t a stupid question at all in the OP, but some of the answers are wrong or incomplete.
Here’s the Straight Dope: The house may have a 3% advantage, but that doesn’t mean you are going home with 97% of your money. The reason is because you recycle your cash repeatedly. Let’s say you put $100 in a slot machine $1 at a time. At the end of that, you collect the result from the tray - on average, it will be $97. But then you do what most gamblers do - run it through again. Now you have $94. Run it through again, and now you have $91. Repeat until you are tired, or broke.
The actual amount of money the casino collected from you is called the ‘hold’. In some places it can be as high as 20%, even if the machine’s actual advantage is only 3-5%. It just means that for the average user who cashed in $100, they cashed out $80. It’s a measure of the edge times how many times you recycled that $100.
A more basic way to look at it is this: If you come to Vegas with $500 to blow, and you leave without your $500, it’s because you probably put that money into action many times, and each time you did you lost 3% of it.
In the end, a Casino’s profit is exactly their average advantage, multiplied by the number and size of the bets made. That’s it. Your $100 can generate thousands of dollars in bets before it’s completely gone, and the house is getting 3% on every one of them.
This is completely wrong. The Casino doesn’t care one bit about your bankroll size. The casino’s expected profit is their advantage X the amount of money put into play at that advantage. Period. It doesn’t matter if that money comes from one billionaire, or from 10,000 people who each have a tiny bankroll. Their gains do not go up because players have a smaller bankroll - if anything, their gains go down because people who bust out can’t keep gambling. But if we assume the casino stays full and busted gamblers are replaced by fresh marks, the Casino’s take does not change one bit.
As for where casinos make their money - the slot machines are the #1 revenue generator. After that will be the high limit table games where the whales play. Then the small table games like $5 or $10 blackjack or Pai-Gow or whatever. But those table games make far less than slots, which is why table games have slowly been vanishing in favor of ever larger and more complex slot machines.
If you want to gamble cheaply in Vegas, there are two variables you need to pay close attention to: The house edge, and the speed of the game. In general, the games which require actual strategy will have the lowest house edge, as will the games that play the fastest. So for example, pass line bets in craps and Blackjack have the lowest house edge in the casino. But for craps that’s only true if you bet pass/don’t pass and take as much in odds as you can get. The house’s trick in craps is all the other bets they offer, most of which are tremendous sucker bets. Blackjack has low odds for perfect play because almost no one knows how to play perfectly.
To see how big a difference this can be to your wallet, imagine playing blackjack for 8 hours at a $5 table, using perfect strategy. You’ll get about 60 hands per hour, which means you’ll put $300 into action per hour, or $2400 over an 8 hour period. Depending on the exact rules, the casino will have maybe a .5-1% advantage over you. Let’s say it’s a 6-deck game with good rules, and house advantage of .71% So in 8 hours, you can expect to pay -$12.50 to the house. Not much. Variance over that time will be much greater. The two standard deviation range of wins or losses works out to be about -225 to +200. That’s how much you can expect to win or lose after 8 hours of play, 95% of the time. In fact, you’ll win about 45% of your 8 hour sessions, and lose about 55% of them.
You can see that it’s not hard to win a daily session, but over time you’ll always lose. For example, let’s say you stay a week, playing 8 hours per day, or 56 hours in total. Over that period of time, you can expect to pay the casino -$88. But the standard deviation also goes down, and now your 2SD range is -650 to +480, and your chance of coming out ahead as you get on the plane home has dropped to about 37%. Still not to bad, and a pretty cheap entertainment for a week!
So where does the casino make all it’s money? Well, let’s do the same calculation for a $1 slot machine. Slot machine players can easily make 500 pulls in an hour. So with an average house take of 3%, that machine is costing you $15 per hour Do that for the same amount of time as you played blackjack, and you just gave the casino $840. And worse, since you a making far more wagers, your standard deviation goes down fast by the hour. Calculating standard deviation for slots is difficult because much of the winnings comes from rare events like royal flushes or five symbols in a row or whatever - payouts that only happen once in hundreds of thousands of spins. So if you don’t hit a big jackpot during your week, your losses will be even greater.
Next time you are in a casino, have a look at all those people frantically pulling levers in the slot pits. They are the ones paying for everything.
While I’m talking general hints about gambling, here are a few:
If a game offers a special statistical display of historical results, it’s meaningless.
If the house offers you a pad and pencil to record trends, it will make absolutely no difference in that game. Ignore it. Here’s a clue: The house loves to give Baccarat players special pads for recording past hands. But if you take out a pad and a pencil at a blackjack table, be prepared to be kicked out of the game or the casino. Because past hands matter in blackjack, and they don’t matter (much) in Baccarat.
Money management will not change the house’s advantage. “Playing with the house’s money”, “Locking in your winnings”, “Doubling your bet until you win” and other betting strategies make no difference whatsoever. The house’s advantage is always the house edge X how much money you bet. Nothing can change that.
Roulette is a sucker’s game. So is Carribbean stud. Baccarat at least has a low house advantage, but Roulette is fast and the house takes 5.26% of every bet on a double-zero wheel.
If all you care about is winning, your best chance is to put your entire bankroll on a single bet. Even if you bet red or black on the roulette wheel, you’re going to double your money about 45% of the time. But of course, if you are in Vegas to have fun you don’t want to bust out the hour you get there. But let’s say you had to fly home for an emergency, and only had enough money for half the fare. If you need to double it with the greatest chance of winning, that’s how to do it. The more you play, the lower your chance of making it out of Vegas with a profit.
Some games in Vegas can be beaten over the long run. They are: Blackjack (with card counting), some fairly rare video poker machines (generally low limit, and not very profitable), and certain progressive jackpot slot machine and video poker games, but only when the progressive jackpot reaches a large enough size that it erases the house advantage. Blackjack is by far the easiest of the three, but it’s also the one the casinos watch very carefully. So if you’re going to learn to count cards, you either need to play low limits where no one cares, or you need to get to the next level and start learning techniques to camouflage your play.
Hand over fist, as a rule. With a rare exception.
Wallaby’s point is not entirely without merit. The casinos do have an advantage because of a larger bankroll, such that they pretty much can’t be wiped out by a single long run of luck, and have maximum bets in place to decrease the likelihood of that happening. But shutting off their chances for short-term ruin isn’t what actually makes them money; they need the house advantage in order for that to happen.
The point is that even if you were to have the odds in your favor, you would have a significant chance of running through your bankroll against a deep-pocketed casino. But the casino would be losing money in general by letting such a game take place, and there would be plenty of others who never do bust out.
I think Wallaby wasn’t so much making a point about casinos as about psychology vs economics.
If every player resolutely left the casino and went home every time they saw that they currently had more than they walked in with (i.e. “Hey, I had $100, now I have $105, it’s been a good day”), things would change.
Wallaby may have been thinking of an earlier era of casinos, when a really rich person on a big winning streak might win more than the house could pay out, from which the ancient cliche “broke the bank at Monte Carlo.” But that expression is from the days before modern finance (and gambling). Even if a bettor at any game or in the sports book managed to place a bet that won more than the casino had on hand in cash, I expect it would be settled by a check and a quick call to the casino’s bank.
No, this is just wrong. Gambler’s ruin has nothing to do with a casino’s profits, other than if the gambler is busted he can’t keep giving the casino money. The casino has no additional advantage over the player by having a giant bankroll.
It’s also not true that the bigger bankroll will always get your money. Proportional betting via the Kelly Criterion will protect you against gambler’s ruin, and if you have an edge and infinite time you will eventually take all the casino’s money.
Again, the casino’s profit’s are fully explained by taking the total amount of action multiplied by the house’s advantage per transaction. There’s no other factor. Gambler’s ruin (either by the house or the player) is a totally different phenomenon that might change the distribution of wins and losses or take someone out of the game completely, but does not change the essential profit equation while the game is being played.
Maybe you meant to say that it’s to the advantage of casino owners to make sure that they have a big enough capitalization that a run of bad luck won’t bankrupt them. That’s certainly a good idea, but it doesn’t change the nature of the game between the casino and the players.
This has nearly happened. Even Casinos can take huge losses when high rollers get lucky. There are people around who are happy to bet $100,000 on a single hand of blackjack. The Mirage once had a quarterly profit drop by two thirds because of an unusual run of good luck at the tables, almost certainly by a small number of very big players. Some of them have bankrolls larger than the casinos.
This right here. I learned how to play what might be called “street craps” back when I was in high school. It’s the same game played in Guys and Dolls, and it’s only pass/don’t pass. It is an easy game to learn and play–I should know, I taught a local amateur theatre group that was doing Guys and Dolls how to play, so they looked realistic when they played on stage. The boys who would act it out got it pretty quickly.
Problem is, that when one is faced with a bank craps table, as in Las Vegas, one is dazzled by all the choices: hardways, field bets, Big 6 and 8, any craps, any sevens, place and buy and lay bets, and so on. It looks horrendously complicated, and the odds offered on the “exotic” bets, as opposed to the pass/don’t pass bets look very tempting. But the street game is buried in there, in the form of pass/don’t pass (and come/don’t come for those who would like more than that).
You can have a lot of fun at a Las Vegas crap table losing a little, or winning a bit, but only if you fall back on the street game. Heck, I once played “street game pass line with odds” for three hours at a Las Vegas table, and when I cashed out, I was up a whole $20. Yay for me, but I had three hours of fun, and a few free beers besides. But during that time, I watched other players play all the exotics, and blow their bankroll in fifteen minutes.
In the end, that crap table gave me $20. But during my three hours there, they probably took in $3000 or more from players who were swayed by the odds on the exotics, and who didn’t know how bad their chances were.
Nitpicks:
(1) s/45%/47.37%/ /* 18/38 */
(2) More interestingly, you can improve the 47.37% chance of doubling your money to 48.09%: Start by betting 1/35 of your bankroll on a single number. If you win, quit; otherwise bet (1/35 + 1/35[sup]2[/sup]) of your original bankroll on a single number; and so on.
This has been discussed at SDMB before! 
The pay out may be 97%, but lets say a guy won $100 for the night, how much is he spending in the casino for drinks, food, etc… Probably a good amount.
Most people blow their winning by gambling them again.
I’m not buying this 97% pay out either, most games are not that close. Maybe Blackjack is if you an expert player.
With proper play (basic strategy), blackjack’s house edge is about half a percent, and craps has just under a percent, too. I can’t find any definitive results for “typical” play, but sites suggest the house edge in blackjack overall (so players using basic strategy and players not) is about 2-3%.
Agreed. I’m going to Vegas for spring break, and I’ll budget $100 for the quarter slots, which is all I’ll gamble. I consider myself a “penny ante” low end gambler at best. I do, however, like walking around and observing the different games, and there is some REAL big time gambling going on.
Most games aren’t, but for that particular casino, almost certainly all of the action in that particular casino is slot machines. There are casinos that don’t offer any table games at all, and it’s quite possible to have slot games that average out to 97% across the entire casino to match the advertised rate. There are a few not too far from here on the Louisiana side of the border. They make a good deal of money (quite handily) in volume.
I think that is the key. If you look at gambling as entertainment, then things change drastically. SWMBO and I go to Vegas once a year for a major tournament. We’ll take in a show or two, have a nice dinner somewhere, do some sightseeing, etc. Sundays are our “play-day”. In between the sightseeing excursions, we’ll hit a casino and play some $5 blackjack (and those tables are hard to find. Circus-Circus is the best one so far) with our own house rules: we walk in with $100 each and try to make it last as long as we can. That’s usually about an hour and a half. During that time, we chit-chat with the other players and the dealers, have some free drinks, and just have a good time. Once the money is gone, we get up and leave. We will also leave if either one of us gets up over $300. That money we won will pay for dinner that night.
It’s no more expensive than going to a show in most cases.
If you’re lucky. In Nevada, it’s actually illegal to use a device to assist in playing a casino game, and even a paper and pencil are considered a “device”. You could get arrested, not just kicked out. And even that’s an improvement over the Old Days, when the casinos took enforcement into their own hands (and their own baseball bats, and their own tire irons, and their own concrete, and…)
Only if enough people leave, and aren’t replaced by other people, that the casino is doing less business. If the casino is staying full, then they don’t give a damn if people leave as soon as they’re up. Because not everyone can leave as soon as they’re up, because not everyone will ever be up at all.
This can’t work. If there are only two outcomes, the only way you can increase the probability of the good outcome is to increase the cost of the bad outcome. And in the original bet of everything on black (or red or even or odd), the cost of the bad outcome is already as high as it can possibly get: Your entire bankroll.
That said, if all you care about is being a winner, and don’t care how much of a winner you are, you can get that chance very high using a Martingale. You’ll end up with a high probability of winning a little, balanced out by a low probability of losing a lot.
Most table games have added progressive bets and additional bets. It gives you the chance of winning possibly life changing money but it ups the profit on the table by a lot. Sure I can sit there and be all superior with my “I know math” attitude and not put the extra dollar down. What happens if I get that improbable but not impossible royal flush? Saved my dollar but lost 100k. I’m there to gamble with money I’m not going to miss so what the hell. Add up all of the progressive bets on the tables for each hand and the house advantage goes way up. It’s a trend which I believe started with Caribbean Stud but has hit just about every table game. Everyone wants the big score.
Pai Gow does not have a built in house advantage so they take a vig on every winning hand. I could sit at a Pai Gow table for hours with my initial buy in. They have added progressive bets to Pai Gow which I’m sure has increase the profit and the turn over at tables.
At this point I don’t know what to say. Except … care to arrange a wager for real money?
Putting $100 in a slot machine with a payback of 97% and sitting there for an hour is like watching compound interest work in reverse.
Instead of getting a 3% return on your money which gets added to your total upon which you make another 3% on, you are taking a 3% loss which drops your total which the next 3% loss comes from.
Put $100 in a slot with a 97% payout and playing an infinitely amount of time will guarantee you end up with $0.
Sure it may be a roller coaster ride with some ups and downs but still always guaranteed to end up at $0.