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# Ask the Slot Expert: The house edge on very high denomination slot machines

10 January 2018

Question: Hey greetings happy New yr iam just curious .What is the house edge on 500 dollar slot machines. Also if the high limit slots dont get play slot it doesn't matter still with it being set as with the rng?

Answer: Happy New Year to you too. May I suggest that next year you dash off your question before the champagne starts flowing?

What's the house edge on a \$500 slot? The general relationship between denomination and house edge is that the house edge decreases as the denomination increases. Put another way, long-term payback increases along with denomination.

A quick and dirty way to graph this relationship between house edge (y-axis) and denomination (x-axis) is to draw a roughly straight diagonal line going from the top left to the bottom right. If you actually graphed real values, what you'd get is more of a curve. Let's take a close look at the far right end of the curve, the high denominations. Once you get above a certain denomination, the house edge stays about the same. There's a lot of room to go from 10% to 2% house edge, going from say pennies to dollars, but once you're at 2% there isn't much room left to decrease the house edge. The edge-denomination curve gets close to 0% house edge, but can never actually get there.

Dollar slots have lower house edges than quarter slots. Five-dollar slots probably have lower house edges than dollar slots — and that's pretty much where the curve bottoms out. Ten dollar, 25-dollar and higher dollar slots have house edges similar to their five-dollar brethren. I've even seen a PAR sheet for a \$25 machine that paid back only 95%.

The reasoning behind the inverse relationship between denomination and house edge is that the higher denomination machines can afford to return a smaller percentage of their bigger pies and still pay their way on the slot floor. The slot machine pie is the amount of action a machine gets, which is the number of bets made on a machine times the amount of each bet.

The mise en place for the very high denomination machine's pie is short one ingredient compared with that of lower denomination machines. As you pointed out, the very high denomination slots don't get much play. Even though each bet made on them is large, the machines don't get as much action as the lower denomination machines that get much more play.

Low denomination machines may have low action even though they get a lot of play because the bets made on them are low. Very high denomination machines may have low action because few players play them.

As a result, the very high denomination machines may have middling long-term paybacks because the casino has to take a larger percentage of a smaller pie.

Maybe we should change our rule of thumb about payback and denomination to consider more than just denomination. We should really be looking at the total amount of action the denominations get.

The new rule: Long-term payback is positively correlated with action for a denomination. The more action the machines in a given denomination get, the higher the long-term paybacks for the machines in that denomination.

Slot club benefits also put downward pressure on the long-term paybacks on the very high denomination machines. A near break-even high denomination slot combined with a generous slot club could lead to a significant money-making opportunity.

It's very common here in Las Vegas to have days with bonus slot club points that give a 0.3% player advantage on NSU Deuces. That gives players an expected profit of \$30 for every \$10,000 in action. Casinos control the damage knowledgeable players can do by limiting the number of bonus points they can earn, not offering the very best paytables above dollars, or both.

It takes about three hours to play \$10,000 on a dollar video poker machine, so the hourly rate is about \$10 per hour. If the casino had unlimited bonus points and \$5 NSU Deuces, a player could earn \$50 per hour.

As a result, the long-term paybacks on the video poker paytables at the locals casinos peak at \$1 or \$2 and go down for the higher denominations. On the strip, with their less generous slot clubs, the paytables peak at the higher denominations.

Moving on to your second statement, the amount of play a machine gets has absolutely no effect on the RNG. There are no outside influences on the stream of numbers generated by the RNG.

The amount of play a machine gets also has no effect on its house edge. The house edge is a consequence of the number of times each symbol appears on the reels.

The only effect limited play on a machine has is to increase the length of calendar time that a machine takes to home in on its house edge. The more play a machine gets, the quicker its actual payback will approach its long-term payback. Another way to say it is that the more play a machine gets, the sooner it gets to the long-term. (Time on a slot machine is measured in spins or hands, not ticks of a clock.)

Very high denomination machines get little play, so it may take many weeks/months for their actual paybacks to near their long-term paybacks. The limited play also explains why the paybacks for very high denomination machines published online and in various magazines show 100+% payback one month and very low paybacks the next month.

The machines haven't changed. Just the luck of the few players who played them.

John Robison

John Robison is an expert on slot machines and how to play them. John is a slot and video poker columnist and has written for many of gaming’s leading publications. He holds a master's degree in computer science from the prestigious Stevens Institute of Technology.

You may hear John give his slot and video poker tips live on The Good Times Show, hosted by Rudi Schiffer and Mike Schiffer, which is broadcast from Memphis on KXIQ 1180AM Friday afternoon from from 2PM to 5PM Central Time. John is on the show from 4:30 to 5. You can listen to archives of the show on the web anytime.

#### Books by John Robison:

The Slot Expert's Guide to Playing Slots
John Robison
John Robison is an expert on slot machines and how to play them. John is a slot and video poker columnist and has written for many of gaming’s leading publications. He holds a master's degree in computer science from the prestigious Stevens Institute of Technology.

You may hear John give his slot and video poker tips live on The Good Times Show, hosted by Rudi Schiffer and Mike Schiffer, which is broadcast from Memphis on KXIQ 1180AM Friday afternoon from from 2PM to 5PM Central Time. John is on the show from 4:30 to 5. You can listen to archives of the show on the web anytime.

#### Books by John Robison:

The Slot Expert's Guide to Playing Slots