How is the Payout Ratio Calculated in Gambling?

All casino games involve random chance and probabilities, even those that are also affected by the player’s skill. As a result, it’s possible to calculate the rate at which these games payout, an important piece of information when it comes to choosing a game. Players usually pick games based on what they know or the kind of games they enjoy. However, smart players know that choosing a game with a good payout rate is more important.

This article was written by Jacek Michałski, a Polish casino expert with a lot of experience in casino games and calculating payout ratios. If you want to find more information about him and his work, you can check his profile here. If not, keep reading for details on how the payout rate of casino games are calculated.

What is RTP

Before we go any further, it’s important to clarify what a casino payout ratio is and what it means for the player. All Polish casino games have a return to player rate, also known as the RTP rate or ratio. This is expressed as a percentage, and it effectively tells the player how much they can expect to win back from their stake when playing for an extended amount of time. Read the betsafe opinie of an online casino to see the RTP rate before you choose a site.

As an example, let’s say there’s a game with an RTP rate of 96%. That means if a player puts €100 on the game over a long period of time, they can expect to win back €96. Of course, it’s not that simple, as the payouts are still completely random. That means that the payer could lose more than €4, and they could also walk away with more than they started with. The payout ratio is measured as if the game is played for an infinite amount of time, which would be impossible.

To put things simply, the RTP rate gives the player a very rough idea of how fair the game is to play. The higher the RTP rate, the less likely they are to lose money. For that reason, most professional players prefer to play games with high RTP rates, such as Blackjack and Video Poker. A poker machine payout ratio is higher because it also involves an element of skill, meaning the player has more control over the outcome.

House Edge

House edge is the advantage that the casino has over the player. All games have an edge, as no Polish casino would ever be willing to give players an advantage or else they would lose a massive amount of money. The house edge is just the RTP rate subtracted from 100%. So for a game with a 96% RTP rate, the house edge is 4%.

As with RTP rates, smart players go with games where they have less of a disadvantage. The lower the house edge, the better and skillful players can decrease it to around 0.5% on games like Blackjack. Those who can count cards can even remove the house edge completely and gain an advantage. However, casinos will remove any player they suspect of counting cards.

Variance

RTP rates aren’t the only thing to consider when playing casino games in Poland. Variance, also known as volatility, is a big factor, particularly when talking about slots. This is a measure of the frequency and the size of wins. Games with a high variance or high volatility pay out less often, but the payouts are much larger. Conversely, games with low variance payout more frequently but with smaller payouts.

While a lot of slots may have lower RTP rates than table games like Blackjack, they have much higher volatility. This helps make them still appealing to a lot of players, as it means you can win big with small bets. You can use a payout calculator to work out how much you can win from a winning wager while playing.

Remember to always check the payout information and volatility of a game before you play. Most licensed Polish online casinos will always publish these details in the game information and these are usually verified by an independent testing service.