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What is RTP and House Edge?

Felicia Wijkander
Last updated on 20th July 2020

Published: 17/12/2019

Categories: Guides, Guides Beginner, News

These are two terms that you would have repeatedly come across in the casino world. Especially if you are a new player, it may be confusing when you see technical jargon like this. We at SevenJackpots, want to break down these terms so that new players like you get some clarity before you dive into the online casino world.

RTP – Return To Player

RTP stands for Return to Player. If you are familiar with business terms, this RTP is very similar to ROI which means Return on Investment. ROI is what an investor is likely to get considering what he invests. Similarly, RTP is what the player is likely to win considering the bets he is placing.

Let’s explore this further with an example. If a game has an RTP of 90%, it means that 90% of what the player bets is what he is likely to win back. Let us consider a player who bets ₹1000 on a game and the RTP for this game is 90%. So, this means that the player is likely to win ₹900 back as the RTP is 90% of ₹1000.

Let us elaborate that with a table:

Total Bet on GameRTP %Potential Winnings
₹100090%900
₹200090%1800
₹300090%2700

Hope we have explained it well. This is what RTP means in theory. But if the odds of you winning a casino game was 90% or anything close to it, how would casinos survive?

The RTP on a game is not what an individual player is probably gonna win. RTP on a game is what the game with pay off ALL of its players in the long run. Makes sense?

Citing the above example, if the RTP on a game is 90%, and the player bets ₹1000, it does not mean that he will get ₹900. It means that of all the bets that have been placed on that particular game, all of the players together stand to win 90% in the long run. And no one knows for how long that long run actually is.

 RTP and House Edge

What is House Edge?

You would have definitely heard the phrase “The house always wins”. This is what house edge is in a nutshell. In the long run, the casino always wins is the premise based on which casinos function.

Even when a player wins big. Even an amount as big as 10 million dollars. The casino can easily pay out because there are millions more that people have lost. So an occasional big win does not even cause a dent in the casino business.

The only way a casino will go out of business due to a loss is if someone wins a million dollars everyday and even that is true only for casinos that have been operating for decades.

Now that we have covered the concepts, let’s get a little technical. Every game that you play, has a house edge. That is what the house stands to win in that game. Since we covered RTP already, it is safe to say that considering the odds of winning the game, whatever is left out after the RTP is the house edge.

So you may wonder, if RTP is what the players win in the long run and House Edge is what the casino makes in the long run, the players clearly win right?

Although the house edge is mostly around 5% or much lesser in casino games, the games are designed in favour of the house. So the house always wins. But there are plenty of strategies and tactics that you as players can use to win over the house edge.

Top 5 Casino Games with Lowest House Edge

Walk away with extra money by playing games with lower house edges. Here are notable casino games with quite low house-edges.

The games are as follows:

  • Blackjack (Single Deck)
  • Craps
  • Baccarat
  • Three card poker
  • Video poker

Let us see about each game and its house edge

Blackjack (single deck) 1.5%

In Blackjack, it’s all in the cards. The number of variants is in the cards but more like how many there are. It is highly suggested that you play single-deck Blackjack. The probability of winning is higher. You can beat the casino as house advantages significantly drop.

One needs a specific skill set, strategy, and smart bankroll management as these all put together means you can walk away with your money and some of the casinos.

Craps (5%- 1.5%)

The many rules and criteria are put off for players wanting to play craps online. However, in brick and mortar casinos they’re famous. They don’t pass/ don’t bet section in craps is interesting with 1.4% house edge is ideal for beginners to place bets

Baccarat (1.5%)

This is the best option for those of you who want a no-frills game but are most unlikely to be interested in slots. In a game of baccarat, you can place bets only on the player, the banker or a tie.

You are better off placing bets on the player over the banker as the banker involves an additional fee. Enjoy yourself with a game deep in history. Employ strategies and start winning.

Three card poker (1.5%)

Three card poker is a very fast-paced game and many love that aspect. It is a fun and quick way to play poker. Each player is dealt with three cards. A king high is the best combination, but a basic poker game strategy applies. Play with a minimum queen high to help your chances.

The payout depends on the dealer cards.

Video poker (0.5% – 5%)

We are constantly buzzed with talk about video poker a 0% house edge business. That’s utter nonsense. Casinos are all in the business of making money. So call me a sceptic. On the contrary, these video poker games can still be highly rewarding.

Even new players can win on simpler easy games such as Deuces wilds or jacks or better.

Now that you know top games that have the lowest house edges you can get right on and start gambling. Get on with it and start earning.

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