Every institution makes use of terms that are particular to them alone. In the world of gambling, terms such as “even money” and “high roller” are commonplace, however some gambling terminologies are more technical and less popular than others. One example of such a term is RTP frequently associated with slot machines in casinos.
What is RTP?
The term RTP may stand for other things but in the world of gambling, it signifies the “Return to Player” and is frequently used by casinos to determine the amount in wins that is expected to be achieved by a player based on a percentage of all the money that is wagered on a slot machine (generally with a minimum of one million plays). It is also an indication as to how well a game is expected to perform. Slot machines are usually programmed using RTP or otherwise called a theoretical payout percentage between 82% to 98% of the money wagered by the players.
For instance, in a game with an allotted RTP of 95% the expected winnings of a player who made a bet of $1 in a hundred places should be $95. However, the RTP stated on a game does not necessarily mean the return per game but rather the maximum expected return for the game.
The minimum RTP varies according to the jurisdiction involved. In some places, the RTP may be lower than 80% while in others it may be required to be higher. Also, as wins are awarded randomly, a series of wins does not necessarily follow after a number of losing plays have been featured. With that in mind, it would be wise to only stake an amount that one can afford.
With the analysis given, a relationship for calculating the total amount returned to a player can be derived as: Total Amount Returned to Player = Total Amount Played per game x RTP (this is however a maximum return scenario). Using the slot machine as a case study, for a total bet of $2,000,000 and an RTP of 85% on the machine, the Total Amount Returned to Player = 2,000,000 x 85% and that would amount to $1,700,000 worth of returns while the operator/house would keep $300,000. This is therefore shows a clear relationship between RTP and “house advantage”.
What Is House Advantage?
Otherwise known as “house edge”, the casino’s house advantage is a form of insurance set up by the casino to insure itself against losing to the player. These built in advantages enable them to always beat the player even when that player is on a winning rampage.
What Is The Relationship Between Rtp And House Advantage?
Whereas RTP shows the return to the player, the gambling house profit is the remainder of the total bet that is kept by the casino. That is to say, for an RTP of 85%, the gambling house profit would be 15% and for an RTP of 90%, – is 10%. As a result, a low RTP implies a higher gambling house and similarly, a high RTP signifies a lower house advantage. Based upon this analysis, we can derive a relationship between RTP and gambling house profit as: House Advantage ($) = Total
Amount Played – RTP
Theoretically, losses will most likely increase in value with increasing number of plays because as wins are recorded for some plays, so also are losses. For example for 50 plays at $1 per play and RTP of 90%, the total amount played would be $50 and the maximum amount returned is $45 signifying a loss of $5. However, when that number is increased to 100 plays, the maximum amount returned for a total bet of $100 is $90, which means a loss of $10!
Finally, for each game that is played, there are two types of RTP involved; the theoretical and actual RTP.
The theoretical RTP is that which has been described throughout this discourse while the actual RTP points to a value that is derived from game trends and periodic statistics, programmed to make sure that the theoretical RTP is not exceeded thus keeping the game in check.
In conclusion, RTP is a system that enables the casino as well as the player keep track of their wins or rather potential wins but more than the player, the casino uses as a medium it ensure that they never lose.