Tag: Bob Dancer

Posted on by — 10 Comments

A Tax on Ignorance

This article was originally published by me on July 24, 2012. Someone recently commented on it to me and I went back to check it out. I feel the article has stood up well over the past seven years and is worth revisiting, partly because many of my readers today weren’t readers way back then. Plus, I wish to extend the story next week.

I was reading a 2011 interview of Edward Thorp, a mathematical genius who created the first widespread blackjack card-counting system (Beat the Dealer) some fifty years ago, and then published a methodology for investing in various markets (Beat the Market) a short time later. He is widely credited with being the first “quant,” which is someone who uses advanced quantitative models for deciding where to invest.

He was interviewed by a group called “Investment Management Consultants Association” as part of their “Masters Series.” This organization is associated with both the University of Chicago’s Booth School of Business and the Wharton School at the University of Pennsylvania. This is a group of academics with top-notch credentials.  

Most of the interview concerned financial investing, but there were a few gambling questions as well. In particular, Thorp was asked why losers at gambling don’t simply quit.

Thorp said, “It seems to me that people are not just wealth maximizers but seeking to maximize something else, whether they do it accurately or inaccurately, whatever their total satisfaction is from whatever they’re doing. I imagine that’s the explanation for why people will gamble and lose money. They supposedly get an entertainment payout. Part of it, though, is that gambling has a tax on ignorance. People often gamble because they think they can win, they’re lucky, they have hunches, that sort of thing, whereas in fact, they’re going to be remorselessly ground down over time.”

Thorp was not speaking about or to advantage gamblers. Although there are a lot of smart gamblers that read my articles, Thorp was addressing a group of people who were accomplished in financial investing, but likely were not particularly knowledgeable about gambling. These people probably believed the house ALWAYS had the edge. For the vast majority of gamblers, this is a realistic thing to believe.

Although it’s possible that Thorp has never played video poker and almost certainly was not thinking of that game in particular when he addressed these writers, I found myself thinking about how Thorp’s comments applied to recreational video poker players.

There are “smart” recreational gamblers. These players know they are taking the worst of it but enjoy what they are doing and don’t mind paying for it. This is actually a rational way to act for some people. These players believe becoming skillful is too difficult, too time consuming, too boring, or too whatever. These players pay for their gambling excitement. Thorp wasn’t talking about this group of gamblers either because these players are not ignorant about their chances. 

There is a large group of video poker players who simply do not believe that pay schedules matter very much and that strategy is mostly common sense. These people believe they will win if they’re lucky and lose if they’re unlucky.

These players often use systems to limit their losses. Some of them believe that if they refuse to lose more than $100 each time they go gambling — but their potential win is unlimited — that this, then, is a good money management system. Others use variations on the Martingale systems. These systems can usually book a small win, but the occasional big losses wipe out far more than those accumulated small wins.

Still others believe in changing machines if either the machine has just hit a jackpot or has been too stingy in paying out jackpots recently. Both reasons are equally fallacious.

These people are not necessarily stupid (although some are). They have their strategies for playing as they do. They just don’t have the knowledge to realize that their strategies are largely worthless. And they don’t understand that this lack of knowledge dooms them to being a long-term loser.

A lot of these players defend their strategies and will argue with anybody who attempts to explain what modern experts believe is the correct way to think. In the days of Internet forums, everybody has the right to post what they believe. If you’re just beginning, you don’t know who is knowledgeable and who isn’t.

Gambling’s tax on ignorance is quite high. It is especially high for those who don’t believe it exists or think that they are immune to it. Most people who know they aren’t knowledgeable play for small stakes relative to their total wealth. To lose a lot, somebody either really must think that their system works or that they really know the right way to do it. And when the ignorant bet big, the results almost always involve getting into a financial hole that keeps getting bigger and bigger over time.

Posted on by — 36 Comments

Take Care of Your Money

As I told you last week, I was recently reading Colin Jones’ new book, The 21st Century Card Counter, preparing to interview him for the GWAE podcast. Although Colin is addressing his comments towards blackjack players, a lot of the general information is useful to video poker players as well. Today’s column was inspired by his Chapter 7: Traveling as a Card Counter.

The first thing I want to address is how much money you should take with you to a casino. If you have access to markers (casino speak for IOUs) at the casino, then you take as little as possible. If you collect money at the start of your play and turn it in at the end, there is less chance for it to be stolen from you between here and there.

But markers are a major difference between video poker players and card players. If you play big enough to use markers, in video poker you’re going to be getting W2Gs that require you to show ID. Therefore, showing ID at the cage is something video poker players have to put up with in order to do business. Many times, blackjack players do not play rated — meaning they do not give their identity to the casino. These people are not willing to show ID at the cage, so that precludes getting markers. For some reason casinos do not respond well to a request such as, “I’m not going to tell you who I am, but I want to borrow $20,000 in cash for a few days.”

So, let’s assume for the current discussion that we are not talking about markers. You’re going to be playing a game where, even if things go really badly, there’s a 99% chance that you will lose less than $5,000 today. (You can get such numbers from the Video Poker for Winners software, or another good product is Dunbar’s Risk Analyzer for Video Poker.) 

If that’s your only play today, it’s unnecessarily risky to start the day with $10,000 in your pocket. Nothing good can happen from having that extra money on you, and we all can think of plenty of bad things. One time in a hundred you’re going to run out of money with “only” $5,000. (That’s basically what having a 99% chance of it not happening means.) Unfortunate, but a cheap enough price to pay for the unpredictable, but real, chance that you could lose that money to either carelessness or malfeasance on the part of others.

Another point on this subject that Jones drives home is to be aware of your surroundings. If you get paid for a big jackpot, it can be noticed by others who want to separate you from your winnings. For this reason, if I hit a jackpot of $8,000 or higher, I ask if I can be paid “in private,” which can mean different things in different casinos. Having a slot attendant loudly counting out, “One hundred, two hundred, three hundred . . . “in front of anybody in the vicinity creates some risk.

In the era of cell phones, it’s very possible for somebody to text, “A 40-something guy in a green shirt with brown pants is carrying a lot of money. I’ll let you know when he’s heading towards the parking lot.” (That would not be me. It’s been decades since someone identified me as being 40-something, and it’s extremely rare that I wear brown pants.) So, your attacker may well be someone who wasn’t present when you were paid, but who found out from somebody else.

After a big winning session, I frequently stroll through the casino, zigging and zagging, too see if anybody is following me. Many times, I’ve approached a security guard and said, “I would like an escort to my car, and if you bring along another guard, I have tip money for both of you.”

If there is a parking garage elevator and there’s another guy waiting there who I don’t know, I’ll frequently “remember” something to do just as the elevator comes and let him go up alone. If there’s a large group in the elevator, I feel safer. If you’re healthy enough, walking the stairs in a parking garage is safer than taking the elevator, plus it’s rare enough that you can easily see if somebody is following you.

If you are mugged in an elevator, be sure to report it to security. Many casinos have cameras in the elevators and that can go a long way towards verifying your story and possibly apprehending the culprit.

There were certainly more things in this chapter that are worth remembering, but these were the items that tickled my “I haven’t written about that recently” button. Thank you, Colin.

Posted on by — 2 Comments

How Often Do You Test Yourself?

I was recently reading Colin Jones’ new book, The 21st Century Card Counter, preparing to interview him for the GWAE podcast. Colin has been on the show a number of times and runs the Blackjack Apprentice Group which teaches players how to win at blackjack.

When referring to while he was running a blackjack team, he wrote: “We settled on having our players test out one another every month and requiring that management test them out every three months. What we discovered is that it’s easy to let your game slide over time.”

Bingo! If I ran a video poker team (probably never going to happen!), that sounds like a policy I’d implement. 

I suspect very few video poker players test themselves very often. Maybe at the beginning when they first are starting out, but how about later? If you’ve been playing NSU (for example) for two years, and you haven’t tested yourself recently, you’re probably making quite a few errors. 

Video poker is arguably more difficult than blackjack. Learning one video poker variation (say, Jacks or Better) is certainly easier than counting cards proficiently, but learning Jacks or Better, Double Bonus, Double Double Bonus, Super Double Bonus, Deuces Wild, Super Bonus Deuces Wild, etc., etc. is more difficult. 

There are players who only play one game, of course. If that works for them, fine. But if you play at several casinos, and you want to play the best game at each, you’re going to have to learn several games. Sometimes that includes the same game with different pay schedules.

In Blackjack, there are adjustments when you switch from a game where the dealer hits soft 17 to a game where he doesn’t, but those adjustments are few. In video poker, when you switch from Double Bonus to Double Bonus Deuces Wild, there’s a huge difference in the way the games are played. 

So, assume you’ve been playing Double Bonus almost exclusively for several months, and for whatever reason, that game dries up and now you’re looking at Double Bonus Deuces Wild. Assume you played the latter game reasonably correctly a year ago, but not since. How do you get yourself ready?

This might not work for everybody, but this is the way I would handle such a situation (and variations of this situation have occurred more than a thousand times over my career).

First, I consult my strategy sheet. Every advanced strategy I’ve ever created is in a computer folder. I find the right one and go over it line by line.

Second, I put the game into WinPoker and use the “Hard Hands” feature, where I have it deal all hands when the first and second plays are closer than 2¢. And then 1¢. And then smaller than that. 

I set WinPoker to “show” rather than “warn.” Where the W indicates a deuce, on a hand like W A♠ 3♠ K♥ 8♥, I don’t need practice pressing the buttons. I just need to know whether the correct answer is the deuce by itself, the deuce and the ace, or perhaps something else. So, I call out (sometimes out loud, sometimes silently) what I believe is the correct answer (the deuce by itself in this case) and hit the button to see if I’m correct. If not, I look up why not. If my strategy doesn’t differentiate this case from W A♠ 4♠ K♥ 8♥, where the correct play is W A♠, I either adjust my strategy or make a determination that this is too petty to worry about. 

After I do this, I switch to Video Poker for Winners and test myself on both the Advanced level and the Intermediate level, as they deal according to different criteria. Sometimes this will identify hands I was misplaying where the difference between the best and second-best play was too large to be found by using the WinPoker Hard Hands technique.

If it’s a game where there is a Dancer/Daily Winner’s Guide, I take the tests found there. I helped write those about 20 years ago, but my memory is imperfect.

Sometimes I go to the Wizard of Odds video poker strategy calculator and look at the exceptions to the basic strategy. That program uses a very different notation than what I am used to but forcing my brain to look at this from both his notation and mine gets my head “into the game.”

At this stage in my career, this takes me maybe an hour or two to accomplish. When I was less experienced, it took me much longer — because sometimes it was the first time I played a game and I needed to create an advanced strategy using various tools. 

After I’ve done these things, it is now time to go into the casino. And if I must change games again in the near future, I do this all again. There are a few games,  like 9/6 Jacks or Better, that I have down pat because 1) I’ve been playing it professionally for 25 years, 2) it’s the easiest game to play perfectly, and 3) I’ve taught a class in it more than 100 times.  

There are other games, like NSU Deuces Wild, for which I go through this procedure about once a year. Simply put, even though I’ve been playing it for 20 years and have gone through this exercise dozens of times, it’s a much more difficult game than Jacks or Better. Since it’s easier to make mistakes, I review it more often. It’s not like I’ll ever forget it below the 99.9% accuracy level, but I prefer to know the game better than that. 

How long it takes you to go through this process depends on you. How much experience do you have? How willing are you to ignore minor errors? How important is winning to you? How good is your memory? And a whole bunch of other things.

I strongly believe, however, that if you don’t do some version of this regimen on a regular basis, you’re playing at a lesser level than you think you are.

Posted on by — 14 Comments

The Most Important Thing in Being a Successful Video Poker Player

There are a number of aspects to being a successful video poker player. Let’s list
the major ones:

1. Know how to play the game(s) competently.

2. Play the game(s) without making unnecessary errors. What I mean is that you’re
able to concentrate and translate what you know into how you play.

3. Obtain and keep the necessary bankroll to survive the swings.

4. Be able to evaluate slot clubs and promotions.

5. Have the discipline to avoid games where you do not have the edge.

6. Have the emotional fortitude to put up with the swings.

7. Be willing to put in the necessary hours for this to work. Video poker is a grind-it-
out affair.

8. Be able to find additional places to play when one or more of your current plays
disappear. This “disappearance” can be that you lost your welcome, the game
was removed, the slot club or promotion which made it a good game is no longer
in effect, along with several other possibilities. If this hasn’t happened to you,
you’re either not very successful or you’re very new at the game.

Okay. If you follow these guidelines, you’ll succeed long term. Most likely. I can’t
guarantee that. It is possible to do everything right and run bad over an extended period
of time. But for most people, the above guidelines work.

So, which of these seven guidelines is most important? In my opinion, keeping
yourself in the money is most important.

Part of this is knowing about bankroll requirements for given plays and avoiding
those that could bankrupt you. “Getting lucky at the right time” can be a part of getting a
bankroll, I suppose, but if you don’t have money management skills, it’s difficult to hang
on to a bankroll.

Over the years, I’ve received a number of emails saying essentially, “I’d like you to
bankroll me. If you believe in what you preach, this should be an easy decision for you.”

And it is an easy decision for me. The answer is always “No” unless I know the
person really well and have a basis for believing in him/her. A stranger who solicits
money via email? They have no more chance for me to send them money than that
prince in Nigeria.

Even those who assure me, “I’ve succeeded at virtually everything I’ve done.
Surely, I’ll succeed in this too. I just need a bankroll to start with.” If they’ve succeeded
at everything, why don’t they have a bankroll? Obtaining money isn’t that difficult for
successful people. It’s “simply” a matter of spending less than you make. (There can be
extenuating circumstances, but I’d have to know a person pretty well and believe their
money problems are a thing of the past to be willing to make a bet on them.)

Most people who don’t have a bankroll have financial leaks in their life. If you’re
trying to save a bankroll for gambling, then tobacco, alcohol, recreational drugs, and
other expensive hobbies (Perhaps skiing? Vacations? Jewelry? New cars?) should be
off the table — or at least very limited. If you have your bankroll issues handled and
want to spend your money on whatever you like, knock yourself out.

Posted on by — 7 Comments

Those Who Don’t Know History are Doomed to Repeat It

The title quote is attributed to Edmund Burke, among others. But it applies to something that happened in Las Vegas recently. I didn’t see it all and there are parts of the story I don’t have, but the part I do have is plenty interesting. 

On Wednesday, July 17, I received a text from a friend telling me there was a video poker free-for-all at the Downtown Grand and the word is out. I didn’t know exactly what this meant, but clearly video poker players were making some money there.

The Downtown Grand is where the Lady Luck casino used to be. It’s on the north side of Ogden, which is one block north of the Fremont Street Experience. It’s not in the heart of the casino district, but it’s pretty close. 

I live a little more than ten miles south of the DG — with 90% of the trip on the freeway. I had something else going on that evening and didn’t want to get mixed up in a big mess. When a casino makes a “too good to last” promotion (which is what I figured it was), it lasts a short period of time. The earliest birds get the biggest worms, and anybody after that gets whatever scraps there are. Often the casino retaliates against any player who “took advantage” of their mistake.

On the morning of Friday, July 19, I had a gym date with a friend who had gone to check out the situation. He said there were 40-50 new machines with games such as Full Pay Deuces Wild (100.76%), 10/7 Double Bonus (100.17%), 10/6 Double Double Bonus (100.07%) for denominations up to $2 single line.

In addition, there were two multi-line machines which were locked up by a team. These machines went up to $2 Ten Play and had the same games on them.

They were offering no slot club benefits. If you wanted to park for free, you had to run $25 coin-in through a slot machine. Otherwise parking was $15 or $20, depending on which day of the week it was. Since you didn’t get any slot club points, there was no reason to put your card in, so he didn’t know exactly how fast the machines were. But he estimated he could play over 1,000 hands per hour.

Oh my! A $2 machine at 1,000 hands per hour places $10,000 into action. A 100.76% return on this game means an expected value of $76 per hour. He said there were plenty of machines and there was no trouble getting on one.

Okay. Maybe it was time to take a visit!

I haven’t played FPDW in more than a decade. Still, years ago I played the game for more than 1,000 hours, wrote a Winner’s Guide on the game, and taught a class on the game perhaps 30 times. At my age, my memory isn’t what it used to be, but it isn’t terrible. 

I took out a copy of the Winner’s Guide for that game and went through all the quizzes. This took me less than 15 minutes and I could now play with more than 99.9% accuracy on the game. If someone were starting from scratch, it would take considerably longer to get up to that level. Many people never do.

After Bonnie’s and my dinner-and-dancing date on Friday night, I headed to the DG. It was now pretty much as advertised, except some time in the past few days about half the formerly-$2 machines were now maxed out at $1. Still, checking every machine that wasn’t being played, I found one for $2 and sat down.

For those who don’t understand $76 per hour, it’s not like a paycheck. It’s a long-term average assuming you get the typical number of $2,000 deuces (frequency: 4,909 hands) and $8,000 royals (frequency: 45,282 hands). Any deuces wild player knows that if you play several hours and don’t hit one of these hands, you’re going to lose today. And that was my result on this day. I spent five hours and lost $1,900.

On the two multi-line games, one player (who I recognized) was playing $1 Ten Play. The other player was playing 25₵ Triple Play, the smallest amount you could play on that machine, slowly. I figured she was a “place holder.” The team only had so many competent players, with each one playing 6- to 8-hour shifts, and apparently there was one shift where they couldn’t find anybody. So, somebody’s friend was called in to “save the seat,” presumably with the team paying her a wage and covering her losses. The team didn’t want to give up a seat because they well could not get it back — and a seat on such a machine was worth thousands of dollars a day for as long as the game lasted.

I found an excuse to go down and play the next day (Saturday) as well. All the $2 games were gone but there were still plenty of $1 machines. This time I got two sets of deuces in five hours and came out $900 ahead. 

I attend a workshop Monday evenings in the downtown area and so that was a good excuse to go early and play at the DG. Now most of the $1 machines had been downgraded to 15-11-4-4-3-2-1. This is not a terrible game at 99.957%, but without any benefits it’s unplayable compared to games a few blocks away. I realize many players around the country would kill to get a game this good, but currently in Vegas you can do better and there’s no reason to play games where you do not have the advantage.

There were still nine $1 FPDW available and I was able to get one. This time I played four hours and won $800. This ended up being my last play there, and my net score was minus $200. A plus score would have been more pleasant, but for a short play, this was well within “normal.” Had the game lasted longer, I’d still play it some of the time. 

One of the players on the team machines was a lady I’ve known for more than 20 years and I went up to chat with her. The machines were cut back to 25₵ Ten Play or $1 Triple Play. She was playing the Ten Play version, as I would. It’s a smaller amount of coin-in ($12.50 per play versus $15) but the variance is much smaller. I gave her the name of the person I thought was running the team and she told me I was wrong but didn’t indicate who was really running the team. It didn’t really matter to me. 

I figured all the games would be downgraded by Tuesday, but I went there anyway to be sure because in the back of my mind I was planning on writing this article. All 40-50 machines were now at the 15-11-4-4-3 game rather than FPDW. And absolutely none of them were being played. The multi-line games still had players on them. I recognized one of the players as a competent pro but didn’t go up and talk to either of them.

I was quite surprised that those games outlasted the others. Although not all the players who were on it were competent, most of them were, and certainly the ones who were playing the highest stakes were. With multi-line games, you get into the long run much faster than you do with single-line games. It begs credulity that these machines were profitable to the casino. But if you left them, why not the others? 

How long the two multi-line machines had the FPDW on them, I don’t know. I am not planning another trip to the DG in the near future unless I hear the FPDW machines have been resurrected — which I doubt, but who knows?

There have been several times in the past two decades where a casino has offered $1 or higher FPDW. The machines have never lasted very long because the game returns a significant amount over 100%, is very easy to play, and there is a competent player base that has good communication. Add that all together, and a casino who puts it out there is going to lose money. How long the casino puts up with this money drain depends on the casino. In some cases, slot directors have lost their job over their decision to install such games.

So why did these games resurface now at the DG? Rumor is that the place is up for sale and the casino was trying to drive up coin-in. If that was their goal, they succeeded. But it must have been a very expensive success. Any potential buyer who dropped by early in the promotion would have been impressed with all the customers. Coming by after the FPDW machines were downgraded, the place was morgue-like.

Posted on by — 10 Comments

The Value of the Right Partner to a Successful Gambler

There are a couple of possible meanings to the word ‘partner,’ and I want to be clear at the start how I am using the word. I’m talking about a life partner. Male, female, same sex or not, married or not. It’s somebody you are emotionally and financially connected with. 

I’m going to be using the term ‘gambler’ to represent the one who is the player and ‘partner’ to represent the one at home. Sometimes you’re both gamblers of course, and we’ll talk about that some other time. 

Some people prefer the word ‘player’ to ‘gambler,’ because they see the first term as playing with an advantage and the second term as playing without. I’m using the term ‘successful gambler’ as someone who gambles with an edge.

If you want to be successful at gambling, your partner MUST be able to put up with financial and emotional swings. If the gambler loses $xxx and the partner goes on tilt and stays there, the gambler is possibly down to the choice of giving up on the dream of being a professional gambler and/or giving up on that particular partner. If children are involved in the picture, that adds complications to the decision.

It often is the case that the non-gambling partner doesn’t really understand the math and variance of the games. This person is forced, generally, to “have faith” in the gambler. This isn’t easy, and certainly many gamblers aren’t deserving of that faith. Most gamblers are net losers. A whole lot more people would like to be successful gamblers than actually are successful gamblers, and it can be very expensive to find out for sure.

I, for one, would probably not be a good candidate to be a partner for somebody else’s dream, unless I understood it a LOT better than many partners do. As a partner I would be looking at such things as:

  1. What have the results been like so far?
  2. How serious is the gambler going about getting to be a better player and only playing in good situations?
  3. Who is the gambler associating with? If the people around your gambler are generally successful and seem to believe in the future of your gambler, that says a lot. If your gambler surrounds himself with non-successful people, there’s a good chance he’s also going to be unsuccessful.
  4. How bad are the emotional swings of the gambler when he is losing? 
  5. How much of a financial cushion do you have between the two of you?
  6. What kind of marketable skills does the gambler have outside of gambling?
  7. As far as I can tell, is the gambler honest with me? 
  8. Is this gambler, over-all, worth having faith in?
  9. What are my options should I leave?

 

(Please note, I have never expected perfection out of a partner — or anybody, for that matter.)

Even with these questions, however, I could be satisfiable. That is, if the gambler appears to be going about it seriously and intelligently, and I really believed I loved her, well, that might be all right.

Some partners aren’t satisfiable. Every loss causes significant worry and stress — and then the fights start. I’m not a psychologist or psychiatrist of any sort, but it appears to me that some people are prone to be worry warts. Some people are so results-oriented that they can’t handle the financial swings. 

In addition to being satisfied with the gambler, the partner must be able to support the partner emotionally and possibly financially through the down periods, which will definitely occur. The partner must be able to share the same goals of the gambler. If, for example, the gambler wants to build up a bankroll and the partner wants to spend all “extra” money on (pick one or more: house, vacations, clothes, jewelry, etc.), the two of them must be able to have a serious discussion that leads to an understanding.

I’m not saying the gambler’s goals should necessarily take precedence. I’m saying that if you’re not on the same page about the goals, it’s very difficult for either party to end up satisfied with the partnership.

Posted on by — 2 Comments

Choosing Between Promotions

In playing to win, you need to figure out where to spend your time. I came across such a dilemma recently and tried to figure out how to solve it. The problem was too complex for me to solve completely, but I created a simplified model using “reasonable” assumptions and was able to come up with a solution using the simplified model. 

Let me explain.

On Wednesday evening, July 3 of this year, Bonnie and I were eating at the South Point with friends. On the way into the restaurant at 5:30, I noticed the jackpot level for the $600,000 “Mad Money Madness” casino-wide progressive was at $23,000. When we finished dinner an hour later, it was at $23,250.

This is a jackpot that will go off before it hits $25,000 (at which time it starts over again at $10,000). If you’re the lucky player who hits it, you get the prize, of course. If you’re playing when somebody else hits it, you get $25 in free play. 

It was going up at a rate of $250 per hour, and likely it would go up faster as the evening wore on because evenings generate more slot and video poker players than daytimes do.

Starting at midnight, however, earning double points would begin. This adds 0.30% to the return.

Assume I would commit five hours to play — either before midnight (when the progressive was very likely to hit) or after. Which would have been the play with the higher EV? (Hybrid results of “play until the jackpot goes off and then if you have any more of your five hours left come back after midnight” were not being considered in this model, but might be a reasonable decision in real life.)

The are many combinations of games and denomination I could consider. I’m going to pick two — namely, NSU Deuces Wild for quarters and NSU Deuces Wild for $2.

This game returns 99.728% with perfect play — and for simplification I’m going to assume the return with the normal 0.30% slot club was 100.00% and the return with the double points was 100.30%. 

I’m going to assume a speed of 800 hands per hour. This is playing pretty quickly, but nowhere near a record pace. This speed has the advantage of making the coin-in for the quarter game to be $1,000 per hour and the coin-in for the $2 game, $8,000 per hour. Again, round numbers make the math easier.

My next assumption may or may not be valid, and that is a quarter machine and a $2 machine have equal likelihoods of being selected as the winner. This could be true, and it also could be true that the $2 machine has eight times the likelihood because eight times as much is being wagered. The rules are very vague on this. The phrase “any machine any time” could apply to either way of doing it. 

I’m also going to assume that in the next five hours, the progressive is going to be hit. Not guaranteed, but very, very likely.

Before I go on, take your best guestimate. Is it worth more to sit down now or wait for double points?

Okay. Figuring out how much the games are worth on double point days is easy. A rate of 100.30% means it’s worth $3 per hour on the quarter machine and $24 per hour on the $2 machine.

Figuring how much the game itself is worth before midnight is also easy. A game worth 100.00% is worth $0 per hour, no matter what your stakes.

So, it comes down to estimating how much the chances at the jackpot are worth. Again, to make the math easy, I’m going to assume 1,000 active players, and that each player has an equal probability of hitting the jackpot. So, on a per-person basis, actually hitting the jackpot is worth $25 — although 999 out of 1,000 people will get zero and one person will have a big smile on his/her face.

We are guaranteed to get $25 when the jackpot goes off so long as we’re playing and we don’t hit the big one. Adding these numbers together, the value of the jackpot to us is $50.

Adding $50 in EV to $0 (the amount the game would be worth with a 0.30% slot club) is also easy. Playing five hours before midnight gives us $50, or $10 per hour.

Comparing the $10 per hour to the $3 or $24 hourly rates we’d earn after midnight is also easy. If we’re playing quarters, sit down and play now. If we’re going to be playing a $2 game, wait for double points.

So, it turns out the problem of whether we should play now or later depends on what denomination we’re playing. I suggest denomination is a consideration that many of you didn’t think was a factor.

The third choice of “the game is not worth enough to bother with” is always an option. Different people will come to different conclusions about that.

If you don’t like my simplifying assumptions, make up your own. Your conclusion will likely end up being the same as mine unless you assume the $2 player had eight times the chances to win the jackpot as the quarter player did. (And I don’t know if that’s a true-to-life assumption or not.) If that’s your assumption, the right conclusion might well be for the $2 player to sit down now and start banging away as fast as he/she could.

Posted on by — 19 Comments

Least Favorite Type of Promotion

Casinos have promotions all the time. Some are very useful to the winning player (such as point multipliers) and some are basically useless (such as 2-for-1 Margaritas during happy hour on Tuesdays.)

Today I want to write about what promotions I like the least and invite you to respond. Wherever you originally read this article, it will be posted on www.gamblingwithanedge.com, where comments are welcome and discussed.

To limit the discussion somewhat, I’ll propose the following parameters on the promotions:

     1. You must have an edge of at least a half percent.

    2. The promotion is within your bankroll (which will mean nickel games for some readers and much larger games for others.)

   3. The promotion will last a reasonable length of time. (This will exclude such things as “come in Thursday and pick up $10 in free play,” or “promotion limited to your first $1,000 of coin-in”.)

The promotions may include several things going on at once (i.e. point multiplier, earn tickets for a good drawing or two, and earn tier credits toward a tier whose benefits you desire.) This would be a good thing in my opinion — but opinions vary.

I do most of my gambling as a “local,” so comps such as RFB and airfare do not enter into my considerations. If you are not a local at whatever casino has this promotion, you’re welcome to include such comps in your equation.

So, with these parameters in mind, let me tell you what I like the LEAST. My list could very well expand after reading your responses.

   1. Very few relevant machines, so players must compete with each other for time on device. Sometimes you must show up six or more hours before the promotion starts in order to get a machine. Sometimes you show up six hours early and find that all machines are already taken with players who are planning on sticking around for the duration. Sometimes you can make a deal with a player to get the machine at such and such a time — sometimes you can’t.

   2. A relatively smoky casino. I know I need to tolerate some of this in order to play in casinos, but some have smoke levels that keep me away, no matter what the promotion is.

   3. Very high variance (say, larger volatility than Double Double Bonus) for stakes that are at the high end of my bankroll comfort zone. This is especially true if the casino has the reputation of kicking out players who win more than a certain amount. 

This means you’re either going to lose a considerable amount or get kicked out. Being kicked out usually includes the forfeiture of future free play (which could well have been part of the calculation) and you can lose comps and other valuable things.

   4. It’s at a tribal casino that has a reputation of not paying players. There is one such casino in Southern California where they recently offered a bonus on W2Gs, and a large number of players were kicked out. Understandably when there are a lot of W2Gs, things back up. Many players made “tickets” of, $2,000 or $3,000 to insert into the machines after they were paid in cash. The casino kicked out some of these players and refused to redeem their tickets. That means players were stuck holding worthless paper — which are only valuable if the casino says they are.

This is not an isolated incident. If you are unfamiliar with what can and does happen at these places, check out Bob Nersesian’s book, The Law for Gamblers, especially his chapter entitled, “Indian Gaming: OMG, WTF”

   5. Uncomfortable machines. This could be because the chairs are locked into position and don’t adjust — and the standard height doesn’t fit my body. It could be the screens are very dark and hard to read. It could be the buttons are very sticky and so frequent mistakes are common unless you play extremely slowly.

   6. Some of the benefits are uncollectible. It could be that there is a future drawing where I would have a decent chance at winning something, but I can’t be there. It could be that a large proportion of the benefits must be collected sometime in the future at that casino and it’s difficult or impossible for me to return. If the edge is high enough without these uncollectible benefits, then this doesn’t have to be a showstopper.

   7. I’m already way ahead recently at this place. Even if a casino doesn’t have a reputation for kicking players out, every casino has a limit for what they will tolerate. If I think I might be close, it makes sense to stay away for six months or so.

Okay. That’s my list at the current time. What did I get wrong and what did I forget to mention?

Posted on by — 16 Comments

What’s Your Take?

Bonnie and I were recently returning from a cruise and were waiting in the Fort Lauderdale airport for our flight home. We were sitting next to some Vegas friends who were on the same cruise — a man and his wife, their 13-year-old son and their 11-year-old daughter.

I was absorbed in a book and wasn’t following what was going on, but all of a sudden, the girl, Kelly, asked me if I wanted her to get me a free drink from a vending machine? There were sodas, water, and a few types of energy drinks available. Maybe other choices as well. It was across the room and I didn’t look closely at it.

“And just how are you going to get me a free drink?” I asked. “They are usually sold at a premium in an airport and not given away.”

“Daddy found this code on the Internet. You enter the code into the vending machine, and it thinks you’re an employee. You then get whatever you want.”

“Have you tried it?” I asked.

“Well, we tried it and got to the last step and then we chickened out. I’m not a thief and couldn’t bring myself to do it for me. But to give to somebody else, that’s different. And I really want to see if it works. So, what do you want?”

“I want to pass on this,” I replied. 

Kelly then asked Bonnie, who didn’t really understand what Kelly was suggesting, so she looked at me for guidance. I told her it looked like a scam that may or may not work. But if it does work, it’s clearly stealing from the vending machine company. When I phrased it that way, Bonnie wanted no part of it either. Kelly got a similar response from both her parents.

Since none of the adults wanted to do this, Kelly concluded that it wasn’t the right thing to do — so she let it go. Had she taken the free drink, I would hope one of her parents would instruct her otherwise. For me to do so would be hypocritical, as I’ve done far worse. Some of those instances readers of my columns have heard about. Some they haven’t.

This is something I might have said yes to 25 years ago. I was new in Vegas and desperately trying to make it. Three dollars saved is three dollars earned.

Even then, however, I wouldn’t have done it in front of five people who knew me and looked up to me. It would have been something I did by myself or with at most one accomplice.

This time there was a dome on the ceiling housing a security camera — which may or may not be active. They didn’t have those 25 years ago. You could just look around and see whether anybody was watching. Not anymore. Although it is doubtful the security system was there to protect against this kind of scam, you never know. The chance of being caught definitely enters into the equation when you’re considering crossing a line.

Would you have taken the free soda?

In casinos, there are numerous situations not so different from this one. When they unexpectedly arise, you need to make a decision. Those with a strong moral compass have no trouble at all with these decisions. The same is true for those with no moral compass at all, although they make the opposite decisions from the ones in the previous category. Where it presents problems are for those of us who look at each situation as a new problem to consider.

I’ve heard it said that the difference between an advantage player (which I consider myself to be) and a cheat (which I do not consider myself to be) is that the advantage player always does things in a casino legally. I wonder. Temptations arise and we make decisions. Even on the decisions we can justify to ourselves, others may decide we have “crossed the line.”

I chatted about this article a bit with a friend and he listed a couple of cases that would be taboo for him that I thought would have been acceptable for me. And vice versa. He was amazed that I considered something off limits.

Dan Ariely is a professor at Duke University and the author of many books and articles including “Ask Ariely,” an advice column in The Wall Street Journal. One thing I’ve learned from reading Dr. Ariely’s works is that the decision we make now (when temptation is far away and just a theoretical concept) can be different than what we decide in the heat of the moment. Although Ariely’s conclusions are often about sexual matters, I believe they also apply to financial matters. Getting “more money” is one of the major things that inspire those who gamble — whether it’s gambling with or without the advantage. 

Posted on by — 3 Comments

Which Game Should I Play?

Bonnie and I were attending a square dance convention where we had to stay for two nights. Close to the dancing venue was a Harrah’s Casino. Having Seven Stars status within the Caesars Entertainment system gets me a room “for free,” but a certain amount of play is expected. I don’t have to play every time I stay at one of these casino/hotels, but a certain percentage of time I do. And it’s a guess as to what that percentage is.

I decided to give them a minimum amount of play, which I arbitrarily defined to be 1,000 Reward Credits a day.

For their “regular” video poker, which takes $10 to earn a Reward Credit (meaning I would need to play $10,000 coin-in daily to earn the minimum I decided upon), the loosest game I found was 9/5 Jacks or Better, returning 98.45%.

For their “premium” video poker, which takes $25 to earn one Reward Credit (meaning I would need to play $25,000 coin-in for the same benefits), the loosest game I found was 9/6 Jacks or Better, returning 99.54%. 

For both games, they had $1 and $2, Triple Play and Five Play. Playing this much for these stakes is acceptable to me.

So, the primary choices are:

  1. Play $25,000 daily at 9/6 Jacks?
  2. Play $10,000 daily at 9/5 Jacks?
  3. Avoid the problem by paying retail at another hotel where no play is expected?

They had a full array of games in each category, so if you’re a Double Double Bonus person, or a Deuces Wild player, or perhaps some other particular game satisfies your itch, you could find a tighter version to play at $10 per Reward Credit or a looser version to play for $25 per Reward Credit. The same technique I describe below may be used for these games as well, but since they all return less than the Jacks or Better games at this casino, I’m personally not interested.

First the math: For 9/6 Jacks, $25,000 * (1-99.54%) = $115 daily expected loss. For 9/5 Jacks, $10,000 * (1-98.45%) = $155 daily loss. The other hotel, $80 + tax + $15 daily resort fee, but you get a free continental breakfast.

For me, the other hotel is not a good option. The dollars came out to be similar, but I receive extra benefits at Harrah’s. Access to the Diamond Lounge, which offers snacks and free drinks, easily offsets most free continental breakfasts. For every Reward Credit you earn, you also earn a Tier Credit, which go towards your tier level One thousand Reward Credits in a day earns you a bonus of another 1,000 Tier Credits.  Consequently, for each day I earn 1,000 Tier Credits, I reduce my annual Tier Credit requirement to stay at Seven Stars by 2,000. (It takes 150,000 Tier Credits annually to remain Seven Stars and I’ve made the decision that it’s worth getting.)

So, between the two games, the looser game is the better choice, even though it requires 150% more coin-in to earn the same number of Reward Credits. This is a conclusion that was for these particular games only. For specific games at other casinos, the “lesser” game may well turn out to be less expensive.

Another consideration is how much time it takes to play. Clearly it takes longer to play $25,000 than $10,000. If I were a single-line quarter player, that would be a showstopper. I could play $10,000 per day for quarters if I basically played all day, not but $25,000. (But even then, I wasn’t in town to gamble but to participate in several hours a day of a square dance convention. Playing quarters was simply not an option.) But someone willing to play, say, $2 Triple Play is going to be finished in less than an hour, so that wasn’t a consideration for me this time.

Another consideration is the variance. Even though playing $25,000 at the better game has a lower expected loss than $10,000 coin-in at the lesser game, if things go badly, you can lose a lot more playing $25,000 than you can $10,000. 

Another consideration is the theoretical (i.e., “theoretical” is the percentage of coin-in the casino expects to win from all play on a particular machine or game). Very possibly, you’ll receive better offers down the road playing $10,000 at a 98.45% game than $25,000 at a 99.54% game. Will those offers be $90 better? Who knows for sure? 

Also, it depends on whether you’re planning on coming back or not. If you regularly visit a casino, the size of your offers is important. For Bonnie and me at this particular casino, probably not so much. One reason we attend this location is Bonnie’s daughter lives somewhat close to here and that’s an attraction. But Bonnie’s daughter is moving in a few months, so it’s very possible we will not be coming back to this casino again. Building up offers here, then, isn’t that useful. Where Bonnie’s daughter lives doesn’t matter to my readers, but adding personal considerations into a decision makes a lot of sense.

Still, Caesars has local offers and national offers. Even if we won’t be back to this casino, we will likely remain in the Caesars system for several years and we don’t want to leave dirty footprints behind us.