Casino Gambling Expectation

Obviously the more you learn about each game, the better off you will be. If you know nothing about blackjack and play at a 10 percent disadvantage, not only will you lose quickly, but your variance (having a winning session) will be quite high. If you learn how to play blackjack and reduce the house edge to 2 percent, your variance will be lowered considerably. If you learn basic Slot Machine Strategy and play against the house with just a small disadvantage, your variance will be similarly small.

So, what does that mean to a gambler? It means your chance of having a winning session and going home happy and patting your dog on the head compared to going home a loser and punting your pup over the back fence is greater if your variance is lower.

You lower your variance by improving your pay and understanding how bankroll management works. As a player, your variance from an average daily loss is based on your bet size, your bankroll, and the number of hands played. If you play basic strategy, get in 300 hands each day at $10 per hand, over the course of the month you will lose an average of about two bets, or $20 each day. However, your daily loss could be a few hundred, or you could win a few hundred. Now comes the important part.

Your variance won’t be any different is you raise your wager, unless your bankroll is limited. You’ll still lose an average of two bets each day, but suppose your bankroll is just $200 each day. With a $10 bet there will be a few days that you lose everything. With a $25 average bet there will be many days that you lose everything, and that’s where the casino wins big, because once you quit, you can’t possibly win.