The Mathematics Behind Major Wins
Games like roulette in online casinos often offer high chances of winning, but the payouts are usually smaller. On the other hand, jackpot games provide higher winnings with slightly lower payout rates.
Bets, Winnings, and Payouts
Real money casinos are built on the idea of balancing income and expenses. This means that the money paid out in winnings is covered by the bets placed.
This principle applies to all gambling activities, including casino games, betting, poker, and bingo—essentially, any game involving money. However, gambling is not a zero-sum activity. Some win while others lose. Fortunately, these roles are not fixed—today’s losers can become tomorrow’s winners.
The concept relies on basic math. For example, five bets of $10 each create a pool of $50, which can be distributed among one or more winners. This distribution can happen randomly, as in casino games, or based on skill, as in poker or blackjack.
That said, the organizer of the game takes a share of the pool. Using the example above, not all $50 will be paid out. Instead, a portion is kept. For most casino games, the payout rate is around 96%, meaning $48 is returned to players. For lottery-style games, the payout rate can be as low as 50%.
Smaller Wins Lead to Higher Payout Rates
When gambling, your chances of winning can range from a tiny fraction to almost 50%. For instance, betting on red or black in roulette gives you close to a 50% chance of winning. Similarly, blackjack and baccarat are games with relatively high odds.
Betting on red or black (or any other even-money bet) in roulette has a winning chance of 48.6%. In baccarat, betting on the bank or the player offers nearly the same odds.
Interestingly, the smaller the potential winnings, the higher the overall payout rate. In roulette, the long-term return is 97.30%. For blackjack, the return can exceed 99% depending on the variation, and in baccarat, betting on the bank offers a return of 98.94%.
Conversely, the larger the winnings, the lower the overall payout rate. This is partly due to the math behind the games and partly because the organizer takes a bigger share.
Jackpot Games Have Lower Payout Rates
In jackpot games, a portion of each bet goes directly into jackpot pools. For example, with a $10 bet, anywhere from 10 to 50 cents might be added to the jackpot. In popular games like Mega Fortune, 5.39% of the bet contributes to the largest jackpot.
This setup reduces the overall payout to players. The bets are not just used to fund regular winnings but also to build a separate jackpot, which only one player will eventually win. Because of this, it’s wise to play jackpot games only if your main goal is to win the jackpot.
Chasing jackpots is naturally appealing. This often allows game organizers to lower the payout rates slightly. When millions are on the line, players are less likely to scrutinize their actual chances of winning or the payout rate. It’s clear that jackpot games typically have lower-than-average payout rates.
The principle of “larger winnings – lower payouts” also applies to games that, while not jackpots, still offer high maximum prizes. Generally, the higher the maximum prize, the lower the average payout rate.
