Shouldn't players play higher-denomination slot machines?

20 December 2012

By John Grochowski

QUESTION: You’ve written repeatedly that higher-denomination slots pay more than lower-denomination games, and that dollars pay more than quarters, which pay more than nickels, etc. How do you know that?

If that’s true, why doesn’t everyone play dollar slots? Shouldn’t you go to the games where the paybacks are highest?

ANSWER: Information on slot machine payback percentages comes from gaming board statistical reports in states with licensed casinos. You can find a summary every month in Strictly Slots magazine, or you can look for up-to-date reports online.

Different states present the information in different ways. The Illinois Gaming Board and the New Jersey attorney general’s Division of Gaming Enforcement list casino win percentages at each coin denomination at each casino in the state. If you subtract that win percentage from 100, you get the payback percentage. The Indiana Gaming Commission, on the other hand, presents just the raw coin in and coin out totals, so if you want the percentages, you have to do the arithmetic. And Nevada doesn’t break its data down by individual casinos, just by region -- Las Vegas Strip, Las Vegas Downtown, Washoe County (including Reno), etc.

Regardless of format, the message is consistent. Higher-denomination machines return a higher percentage of wagers to bettors than do lower-denomination machines.

As for your other questions, there is a variety of reasons players choose low-denomination games -- especially pennies, nowadays -- instead of the higher-paying dollar-and-up machines. Part if it’s the entertainment factor. A large percentage of the betting public would rather have the animation, film clips, music and sound effects of today’s penny video slots than a higher payback percentage.

Part of it’s the volatility of the games. Dollar three-reel games return a higher percentage, but do it in part by reserving a larger chunk of the overall return for the rare big hits. With less going into smaller returns, it’s easier to lose your stake faster on high-denomination games, while low-denomination games are designed to keep you in your seat longer.

And part of it is just bet size. Players who can’t afford to risk $3 a spin to get the full payback percentage on a three-coin dollar game can get their day’s entertainment 40 cents or so at a time on a penny slot.

QUESTION: I play at a casino that has different blackjack rules in the high-denomination room. In the main pit, it’s six decks, blackjacks pay 3-2, dealer hits soft 17, you can split any pair up to three times, except no resplitting aces, and you can double on any first two cards, including after splits. In the high-limit room, it’s mostly the same game, except the dealer stands on all 17s.

I can usually get a spot at a $10 table on the main floor, but the lowest in the high-limit room is $25. Should I be playing at the $25 tables?

ANSWER: When the dealer hits soft 17 in the six-deck game you describe, the house edge against a basic strategy player is 0.62%. If the dealer stands on all 17s, as in the high-limit room, that house edge drops to 0.40%.

If you’re playing at a full seven-player table averaging 50 hands per hour, then at $10 a hand you risk $500 an hour. Your average loss at main floor rules is $3.10. Betting $25 a hand, the risk jumps to $1,250, and the loss per hour rises to $5.

So even with the lower house edge, your average loss per hour is higher with the bigger bets. You also run the risk of going broke fast when you hit a bad streak with more money on the table -- and we all hit bad streaks.

One more factor to consider is speed of play. A faster game favors whoever has the edge, and unless you’re a card-counting expert, that’s not you. If fewer players are in the high-limit seats, the game moves faster, hitting 100 hands an hour if there are only three players in action and 200-plus if you’re head-to-head with the dealer.

Never bet more than you can afford to lose. The high-limit players get a better deal, but whether it’s a deal you can afford to take is between you and your bankroll.