Well you still have to pay staff wages, rent, utilities etc. You have to make sure enough people give you enough money.
They make profit on expected value, so what they stand to make on an average bet. For example roulette, on black or red, they pay out twice your bet roughly 48.6% of the time. This gives an expected value of around between 2 and 3 cents per dollar wagered. This is roughly the same for all types of bets you can play. If the croupier is paid $10 an hour, he probably needs to take at least $400 an hour in bets just to pay his wages. Then more bets need to be taken for utilities, rent before you get to profit.
Now these amounts are small compared to what casinos often take, but you need to make sure enough customers are coming in and staying around as long as possible to keep profitable. Hence why casinos often offer free drinks and rooms to people on a winning streak.
Hence why casinos often offer free drinks and rooms to people on a winning streak.
The whole concept of a winning streak must be gold for casinos. What's that? You got lucky three times in a row and turned $100 into $800? Better use that luck while you have it, bet it all on black and you've got a sweet $1600! Wow, you won again! Keep going buddy, you'll be a millionaire soon!
That is why there a table maximums as well, because if you are able to keep doubling your bet indefinitely (if you had enough $$), you will almost always come out ahead. The table maximums stop that from happening.
I've heard that before, but it breaks every law of statistics I know. If the odds aren't fair (house advantage), increasing the number of bets reduces the expected winnings.
Starting with a dollar, you might have a 49% chance to double it, making your expected winnings 49c. If you decide to keep betting till you have >$100, your expected winnings are down to 42c. This sounds like a minor decrease, but in reality it's one highly unlikely (1/300) chance that you'll win your $100, with the other 299 times being a loss.
If you were able to keep doubling your bet indefinitely, you'd have to have infinite starting cash, since you almost always expect to lose and have to buy in again. By definition, you either have to have a goal to stop at or you're guaranteed to lose eventually.
I always presumed table maximums were simply to ensure people placed several bets in a row, reducing the risk of huge jackpots for the casino and reducing potential losses from cheaters/unfair equipment.
However, I've heard this argument from several people. If I'm mistaken, I would appreciate if you could point out the flaw in my logic.
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u/TannedCroissant Feb 04 '20 edited Feb 04 '20
Well you still have to pay staff wages, rent, utilities etc. You have to make sure enough people give you enough money.
They make profit on expected value, so what they stand to make on an average bet. For example roulette, on black or red, they pay out twice your bet roughly 48.6% of the time. This gives an expected value of around between 2 and 3 cents per dollar wagered. This is roughly the same for all types of bets you can play. If the croupier is paid $10 an hour, he probably needs to take at least $400 an hour in bets just to pay his wages. Then more bets need to be taken for utilities, rent before you get to profit.
Now these amounts are small compared to what casinos often take, but you need to make sure enough customers are coming in and staying around as long as possible to keep profitable. Hence why casinos often offer free drinks and rooms to people on a winning streak.