How much money you should bring to the casino should be based first on how much money you can afford to lose.
In other words, if you can’t afford to lose it, don’t bring it with you.
All casino games carry a mathematical edge for the house. This doesn’t mean you can’t win – you can. The casino counts on a percentage of customers winning to keep their customers coming back.
But you can’t count on winning.
Therefore, if you can’t afford to lose that money, you shouldn’t gamble it on casino games.
The next consideration has to do with which games you want to play, at what limits, and for how long. That’s what the rest of this post covers.
Calculating the Average Hourly Loss Rate of a Casino Game
One factor to consider when deciding on a casino bankroll is how much money you’re mathematically expected to lose on a game per hour.
That estimate is easy to calculate, but as you’ll see, it doesn’t tell the whole story.
You multiply the average amount you’re betting by the number of bets you’re making per hour. That gives you the average hourly action you’re bringing the casino.
You multiply that hourly action by the house edge for the game to get the average expected hourly loss.
Here’s an example:
You’re playing baccarat. At an average baccarat table, you’ll probably see 70 hands per hour.
Let’s assume you’re playing for $25 per hand, which isn’t unusual. Baccarat is traditionally a high stakes game. In a lot of casinos, the betting minimum for baccarat is in that vicinity.
You’re putting $25/hand X 70 hands/hour, or $1750 per hour into action.
Let’s assume you’re making the banker bet every time, which is the lowest house edge bet you can make in baccarat. The house edge for that bet is 1.06%.
Your average hourly loss would be $1,750 X 1.06%, or $18.55 per hour.
One way to determine the bankroll you’d need for a trip to the casino would be to calculate how much time you want to spend at the baccarat tables. Let’s say you’re going to be at the casino for 3 days, and you want to play baccarat for 2 hours every morning and 2 hours every night.
That’s a total of 12 hours of action with an average hourly loss of $18.55 per hour, or $222.60.
As far as a starting point for deciding how much money you should bring, that’s a good way to estimate it.
But there’s more to the equation than that…
The Role of Volatility in Deciding How Much Bankroll You Need for a Casino Visit
In baccarat, when you bet on the banker, you win almost half the time, and you lose a little more than half the time. This means that you’ll usually see small swings in fortune.
Those swings in fortune are called “volatility.”
You can often estimate volatility by the size of the payouts. In many casino games, payouts are “even money.” You bet $25, and you either win $25 or lose $25.
Even with a low volatility game, you will experience swings up and down compared to the expected loss. This is why some players come home a winner some of the time, even though most gamblers come home with a net loss.
The less time you spend on the game, the more likely you are to show a result different from the mathematically expected result.
If you use the calculated average expected loss with a game which has low volatility and even money payouts, I recommend bringing a bankroll of about twice the calculated necessary bankroll. If I’m playing baccarat for $25 per hand, for example, I want to bring between $400 and $500 – even though my expected loss is only $222.60.
I want to outlast any streaks of bad luck.
But other games (or other bets with the games I’ve already discussed) win far less often, even though they have a higher payout. They might even have the same house edge, but from a bankroll management perspective, higher volatility means you should have more money on hand.
Here’s an example of a higher volatility bet:
When you bet on a single number in roulette, you win 1 in 38 times, or 2.63% of the time. When you do win, you get a 35 to 1 payout.
Most of the time, you’ll lose, but on the occasions when you win, you get a bigger win to make up for a lot of those losing spins.
The house edge for a roulette bet is 5.26%. It doesn’t matter if you’re making the high volatility bet or the low volatility bet. Over time, that’s how much the casino expects to win from you on average.
You could calculate a bankroll requirement for roulette by looking at your average number of bets per hour (40) multiplied by your average bet ($25, for our example purposes). That’s $1000 in hourly action.
5.26% of $1000 is $52.60 per hour in expected losses.
To spend 12 hours on roulette, you’d need $631.20.
And you’d probably want to double that and bring between $1,100 and $1,300 with you to make sure you don’t run out of money if your luck runs bad.
But if you’re a single number bettor, you should probably bring even more than that. It’s a lot easier to have a long losing streak when you’re facing a probability of 2.63%.
These principles also apply to craps – the low volatility bets are the ones with the even money payouts.
What if You Like Gambling Machines?
The calculations aren’t much different for gambling machines, but the math is explained differently when talking about gambling machines.
Instead of dealing with the house edge, you’ll usually be dealing with an estimated payback percentage. That’s just the average amount of each bet the machine is expected to return to you on average based on your action.
The payback percentage is just 100% minus the house edge.
For example, if you’re playing slot machines at a casino which has an average payback percentage on its slot machines of 92%, the house edge is around 8%.
But you need to keep in mind 2 things when considering slot machines:
- The higher jackpot means that the big wins come less often than 2.63% even. With a top jackpot of 1000 for 1, the probability of winning it is far less than 1%.
- The average slot machine payback percentage for a casino is just an average. You have no way of knowing if the machine you’re playing on is above or below average.
The average slot machine or video poker player makes 600 spins per hour. If you assume that you’re betting $3 per hour, you’re looking at $1800 per hour in action.
When facing an 8% house edge, you’re looking at an expected hourly loss of 8% X $1800, or $144. For 12 hours of play, you’ll need at least $1728.
But if you want to make sure you don’t run out of money, you should probably bring at least 3 times that amount, or close to $5000.
That’s to compensate for the slot high volatility.
You want to bring enough money to the casino to get to play for as long as you want to play. This means accounting for the average amount you expect to lose over that amount of time.
But it also means padding that amount based on the volatility of the game you’re playing.
If you have a modest bankroll, this means you should focus on low volatility games which also have a low house edge. I recommend baccarat and/or blackjack.
But if you’re going to play blackjack, master basic strategy.
Otherwise, the house edge for blackjack is average at best.