What Is House Edge in Casinos?

What “House Edge” Really Means

House edge is the built-in mathematical advantage a casino has on a game or bet, shown as a percentage. If a game has a 2% edge, the casino expects to keep $2 of every $100 wagered over the long term.

It doesn’t mean you lose 2% every session. Short-term results swing. Over many bets, though, results tend to converge on the math.

Why the Casino House Edge Matters to Your Bankroll

Small percentages add up fast. A 1% edge is gentle; a 10% edge is costly. When you know which bets are friendlier, you can:

• Play longer on the same budget
• Reduce costly mistakes (like bad side bets)
• Pick games where skill actually helps

How House Edge Is Calculated: A Simple Walkthrough

House edge ties directly to expected value—the average outcome of a bet if repeated many times.

Formula you can use

Expected Value (EV) per bet = (Probability of winning × Net win) + (Probability of losing × Net loss).

House Edge = −EV / Bet Amount.

Example: American roulette straight-up bet

There are 38 pockets (1–36, 0, 00). A $1 straight-up bet pays $35 if your number hits.

• Win probability = 1/38; Net win if hit = +$35
• Loss probability = 37/38; Net loss if miss = −$1

EV = (1/38 × $35) + (37/38 × −$1) = $0.9211 − $0.9737 = −$0.0526.

House Edge = $0.0526 / $1 = 5.26%.

Odds analysis vs. house edge

Odds analysis tells you how often outcomes occur. House edge converts those odds and payouts into a clear percentage cost per bet—much easier to compare across games.

Quick House Edge Benchmarks by Game

• Blackjack: About 0.3%–1% with perfect basic strategy and good rules (3:2 blackjack, dealer stands on soft 17). 6:5 blackjack can push the edge near 2%+.
• European Roulette (single zero): 2.70% on most bets.
• American Roulette (double zero): 5.26% on most bets; the 0-00-1-2-3 “top line” is 7.89%.
• Baccarat: Banker ≈ 1.06% (with 5% commission), Player ≈ 1.24%, Tie ≈ 14.36% at 8:1 payouts.
• Craps: Pass Line ≈ 1.41%; Don’t Pass ≈ 1.36%; Place 6/8 ≈ 1.52%; Field varies (≈ 5.56% typical, ≈ 2.78% when 12 pays triple).
• Video Poker (Jacks or Better 9/6): ≈ 0.46% with perfect play. Weaker paytables raise the edge a lot.
• Slots: Highly variable, roughly 2%–15% depending on machine and denomination.
• Keno: Often 20%–35% (ouch).

Note: Actual edges vary by rules, paytables, and casino. Always check posted rules or info screens.

Real-Life Story: The $200 Roulette Lesson

On a weekend trip, my friend Alex brought $200 for American roulette. He bet straight-up numbers because the win felt big. After 90 minutes, the budget was gone.

Later, we ran the math. A 5.26% house edge on frequent bets will grind you down. The next visit, he switched to European roulette and mixed in outside bets with lower volatility. He played longer and left with half his bankroll intact—far better entertainment per dollar.

How to Use House Edge and Expected Value to Play Smarter

1. Pick lower-edge games first. Blackjack (with 3:2 payouts), baccarat Banker, European roulette, and solid video poker paytables are safer choices.
2. Learn the rules that matter. In blackjack, 3:2 payouts and dealer standing on soft 17 are key. In craps, favor Pass/Don’t Pass with odds.
3. Avoid high-edge bets. Tie in baccarat, “sucker” side bets, weak slot paybacks, and keno drain bankrolls.
4. Use basic strategy or paytable charts. Skill can shrink the edge where strategy matters (e.g., blackjack, video poker).
5. Manage your bankroll. Decide your session budget, bet sizing (e.g., 1%–3% of bankroll), and a stop-loss and stop-win target.
6. Think in long-term averages. A hot streak doesn’t change the math; it just rides the variance for a while.

Practical mini-calculation you can do at the table

If a bet pays even money but loses to several more outcomes than it wins, the edge is likely modest but real. Compare similar bets between games; the lower the edge, the better your average cost per bet.

Where Skill Can Shift the Numbers

• Blackjack: Basic strategy can cut the edge below 1%. Card counting can swing the long-term EV positive, but casinos watch for it and can ban counters.
• Video Poker: With top paytables and perfect strategy, returns can approach 99%–100%. Promotions can push EV slightly over 100% on rare days.

Elsewhere, “game advantage” mostly stays with the house. Learn where skill matters—and where it doesn’t.

Common Myths vs. The Math

• Myth: “After a bunch of reds, black is due.” Reality: Independent spins don’t remember past outcomes.
• Myth: “Betting systems beat the house.” Reality: Progressions change volatility, not the underlying edge.
• Myth: “All roulette wheels are the same.” Reality: Single zero beats double zero for players.

Key Takeaways

• House edge is your average cost to play a bet.
• Lower-edge games stretch your bankroll and time on device/table.
• Use strategy where it matters; skip high-edge side bets.
• Think in expected value terms to make clear, rational choices.

FAQs

Conclusion

Now you know what the casino house edge is, how it’s calculated, and which bets treat your bankroll better. Use this knowledge to choose low-edge games, apply strategy where it matters, and enjoy the action with realistic expectations.