When playing casino games at NetBet Casino, you may come across terms that describe the mathematics behind how different games work. One of the most important is the “house edge”, which describes the casino’s theoretical mathematical advantage over players in the long term. Understanding house edge can make it easier to compare casino games and interpret other commonly used terms, including RTP, variance and volatility.
House edge doesn’t tell you whether you’ll win or lose your next bet. Instead, it describes the underlying mathematics of a casino game across a large number of wagers. Here’s how it works and what house edge percentages actually mean.
What Is House Edge?
House edge is the theoretical mathematical advantage a casino has in a particular game, usually expressed as a percentage of the amount wagered over the long term.
Imagine a casino game has a theoretical house edge of 2%. This doesn’t mean the casino automatically takes 2% from every wager you make. It also doesn’t mean you’ll lose exactly £2 for every £100 you wager.
Instead, the figure represents a theoretical long-term expectation based on the rules, probabilities and payouts of the game.
Individual results can be very different. A player might finish a short session ahead, while another could lose significantly more than the theoretical house-edge percentage might suggest. As more and more wagers are considered, the game’s underlying mathematical probabilities become more relevant.
How Does House Edge Work?
Casino games use rules and payout structures that generally create a mathematical advantage for the casino.
To understand why, think about the relationship between probability and payouts. Every possible outcome has a certain probability of occurring. The payouts offered for winning outcomes can then be compared with those probabilities to determine the game’s expected mathematical return.
If payouts perfectly reflected the underlying probabilities without any advantage built into the game, there would be no mathematical margin for the casino. Casino game rules and payouts are instead generally structured to provide the house with an advantage over the long term.
How this is achieved differs considerably between games.
Roulette uses a wheel containing numbered pockets, for example, while blackjack’s mathematics depends on its rules and the decisions made during play. Slots use much more complicated mathematical models involving reel configurations, symbols, paylines or other win mechanics and payout values.
How Is House Edge Calculated?
Calculating the precise house edge of a casino game can become complicated, but the basic principle is relatively straightforward.
The probabilities of the game’s possible outcomes are considered alongside how much each outcome pays. These figures can then be used to calculate the game’s expected value over the long term.
Players don’t usually need to perform these calculations themselves.
For many online casino games, information such as rules, paytables and theoretical RTP may be available within the game information. These details can help players understand the mathematics without having to calculate every possible outcome manually.
It’s also important to use figures for the specific version of a casino game you’re playing. Games with similar names can sometimes have different rules, payouts or mathematical models.
What Does a House Edge Percentage Actually Mean?
House edge percentages are easy to misinterpret.
Suppose a casino game has a theoretical house edge of 3%. If you wager £100, it doesn’t mean you are guaranteed to finish with a £3 loss.
You could finish ahead. You could lose £3. You could also lose considerably more.
The 3% figure instead represents the game’s theoretical long-term mathematical advantage across a very large amount of wagering.
This distinction between theoretical and actual results is particularly important when discussing casino mathematics. Percentages such as house edge and RTP describe the mathematical model behind a game; they don’t predict the outcome of an individual bet or session.
House Edge vs RTP: What’s the Difference?
House edge and Return to Player (RTP) are closely related concepts, but they describe casino mathematics from different perspectives.
RTP describes the theoretical proportion of wagered money that a game is designed to return to players over a very large number of plays. House edge describes the theoretical mathematical advantage held by the casino.
For a game where the two figures are directly complementary, a theoretical RTP of 97% would correspond to a 3% theoretical house edge.
Again, this doesn’t mean a player wagering £100 receives £97 while the casino keeps £3. Both percentages describe theoretical long-term mathematics rather than the outcome of an individual playing session.
If you’d like to explore this concept in more detail, our Casino RTP: What Is Return to Player? article explains what RTP percentages mean and how players should interpret them.
You can also read our guide to RTP, Variance & Volatility: How to Choose a Slot That’s Right for You to see how theoretical returns relate to the wider characteristics of casino games.
Why Does House Edge Differ Between Casino Games?
There isn’t one house-edge percentage that applies to every casino game.
Each game has its own rules, probabilities and payouts. These determine the mathematical advantage built into the game.
House edge can therefore vary between roulette, blackjack, baccarat and other casino games. It can even vary between different versions of the same game.
This is why players should be careful when comparing house-edge percentages online. A percentage quoted for one set of rules may not apply to another version of the game.
The same principle applies to online slots. Different slots can have different RTP settings and mathematical models, meaning they don’t all provide the same theoretical return.
House Edge in Roulette
Roulette provides a useful example of how a game’s structure can influence its house edge.
A roulette wheel contains numbered pockets, while the game offers payouts for predicting where the ball will land. The presence and number of zero pockets affect the probabilities behind these bets.
Different versions of roulette can therefore have different mathematical advantages because their wheel layouts and rules aren’t necessarily identical.
This demonstrates why looking at the exact variant of a casino game matters. Two games can both be called roulette while operating with different underlying probabilities.
House Edge in Blackjack
Blackjack is slightly more complicated because the theoretical house edge can depend on both the rules of the particular game and how it is played.
Different blackjack variants can have different rules covering areas such as when the dealer stands or draws, whether players can double in particular situations and what other playing options are available.
These variations can affect the game’s underlying mathematics.
For this reason, there isn’t a single house-edge percentage that accurately describes every version of blackjack. When comparing figures, players should check which rules and assumptions have been used.
Do Online Slots Have a House Edge?
Online slots are usually discussed in terms of RTP rather than house edge, but the same broad mathematical concept applies.
If a slot has a theoretical RTP of 96%, for example, its theoretical casino advantage can broadly be expressed as 4%, where those figures are directly complementary.
However, knowing this figure tells you very little about what your next playing session will look like.
Two slots could have the same theoretical RTP while offering very different experiences. One might award smaller wins relatively frequently, while another could produce wins less often but have greater potential for larger payouts.
This is where concepts such as variance and volatility become important.
House Edge, Variance and Volatility – What’s the Difference?
Although house edge, variance and volatility all describe aspects of casino game mathematics, they aren’t interchangeable.
House edge describes the casino’s theoretical mathematical advantage over the long term.
Variance relates to how widely results can differ from an expected value. In casino games, this helps explain why short-term outcomes can vary considerably even when the underlying mathematical expectation remains unchanged. You can learn more in our guide to What Is Variance in Online Casino Games?
Volatility is particularly common when discussing online slots and generally describes the pattern of wins a player might experience. Higher-volatility games tend towards less frequent but potentially larger wins, while lower-volatility games generally produce more frequent, smaller wins. Our What Is Volatility in Online Casino Games? guide explores this in greater detail.
This means two games could have similar theoretical returns but very different volatility and playing characteristics.
Does a Lower House Edge Mean You Will Win More?
Not necessarily.
A lower house edge represents a smaller theoretical mathematical advantage for the casino over the long term. It doesn’t guarantee that an individual player will win more during a particular session.
Short-term results can vary significantly from theoretical expectations because casino games involve uncertain outcomes.
A player could experience a strong run of results on a game with a comparatively higher house edge or lose during a session on a game with a lower house edge.
House edge is therefore useful for understanding and comparing game mathematics, but it isn’t a prediction tool.
Why Should Players Understand House Edge?
Understanding house edge gives players useful context about how casino games are designed.
It helps explain why casinos maintain a mathematical advantage over the long term and why short-term results shouldn’t be confused with theoretical percentages.
House edge can also make related casino terminology easier to understand. Once you know the difference between house edge, RTP, variance and volatility, it’s easier to interpret the information provided about different casino games.
However, knowing a game’s house edge doesn’t provide a way to guarantee wins or remove the financial risk involved in gambling. Casino games should always be treated as entertainment rather than a way to make money.
House Edge FAQs
What does house edge mean in casino games?
House edge is the casino’s theoretical mathematical advantage in a particular game over the long term. It is generally expressed as a percentage of the amount wagered and shouldn’t be interpreted as the amount an individual player will lose during a session.
Is house edge the opposite of RTP?
For games where the figures are directly complementary, house edge and RTP can be viewed from opposite perspectives. A theoretical RTP of 96%, for example, corresponds to a theoretical house edge of 4%. Both figures describe long-term mathematical expectations rather than guaranteed player results.
Does a lower house edge mean a casino game is better?
A lower house edge means the casino has a smaller theoretical mathematical advantage under the relevant rules, but that doesn’t automatically make a game better for every player or guarantee better results. Game rules, volatility, variance and personal preferences can also affect the playing experience.
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