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Online Gambling Sites US > Casino Guide > Understanding RTP in Casinos: Definitions and Meanings in Gambling
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Understanding RTP in Casinos: Definitions and Meanings in Gambling

Publish Date:12/01/2024
Fact checked by: Eric Bale

RTP is one of the most crucial components in casino gaming but few players really understand what it means. So, what is RTP in casino terms? Well it’s an abbreviation of ‘Return To Player’ and it’s shown as a percentage.

The RTP is usually related to slot games and it represents the average amount of money that a game pays back (or returns) to the player over a period of time. There is a little more to know besides that, so here I’ll explain in more detail and give you some examples of how it can affect your casino experience.

Understanding RTP

As mentioned, RTP (Return To Player) represents the amount of money a casino game is likely to pay out to players over an extended period. This is a rather imprecise science, so there is no specific length of time or exact number of spins that I can demonstrate to you.

However, in order to help you understand the RTP better, I’ll show you an example;

Let’s assume that a specific casino game has an RTP of 96%. What this implies is that if you wager $1 on the game, you’re likely to get $0.96 back. And if you wager $100 in the same game, you’ll win back $96 on average.

Which is calculated like this:

96% of $1 {(96 ÷100) x $1} = $0.96

or

96% of $100 {(96 ÷100) x $100} = $96

But don’t take the example above too seriously, as no game pays out that accurately. That’s because the exact RTP gambling meaning and interpretation is based on gameplays over an extended period. Which means you’d need to play thousands of hours on a game to realize exactly its RTP. A game could pay out more or less than its RTP since anything can happen in the short term.

Meanwhile, if a casino game has a high RTP, it simply means it has a higher payout rate — and vice versa is true. But of course, there's no game with an RTP of 100%. And this is where the house edge comes in.

House edge

By definition, the house edge is the advantage the casino has over you as a player in the course of a specific game. Both house edge and the RTP are intertwined in that one means the opposite of the other. Additionally, the house edge and RTP complete each other in calculating how much you could possibly win and what the casino keeps and when added together they equal 100%.

Moreover, when you talk of the house edge in terms of casino table games like roulette or blackjack, it is also expressed as a percentage, but usually a small one, so the house edge in this context is the percentage that the casino keeps from the total amount wagered on a game.

Calculation of RTP

So ignoring for a moment the difference in terminology, every casino game has an RTP and the game developer will state this payout percentage on the game specs after launching. So, when playing, you won’t need to calculate the RTP by yourself — the software provider has already done that for you. The only difference is, the way it is usually represented to the player by the casino.

When calculating the game's RTP, there are lots of aspects game developers take into account. In the case of a slot game, the provider will consider the number of paylines as well as the bonuses included in the game. So, if a slot has bonus spins, wild symbols, multipliers, and jackpots, calculating the RTP value is incredibly complex, as they all affect the payout rate.

Even so, there’s a simplified formula for calculating the RTP, which is;

Return To Player = (Total amount returned to players ÷ Total sum players have staked) x 100%

Let’s take a look at an example;

If all players from all over the globe wager $500,000 on a specific slot (a total of one billion spins) and the slot pays out $480,500 in winnings, the RTP of the game is calculated as follows:

(480,500 ÷ 500,000) x 100% = 91.7%

But keep in mind that even with the above formula, the simpleness of calculating the RTP also depends on the casino game type. For instance, calculating the RTP of table games, such as blackjack, craps, poker, baccarat, and roulette is quite challenging. This is because the Return To Player depends on the bet amount and the strategy of players.

Generally, the payout percentage is measured over 10,000 or 100,000 games, according to the UK Gambling Commission. When calculated, the RTP should be clearly displayed on the game for all players to see.

RTP and slot machines

With an average RTP of 95%, slots are the most popular casino games and it's worth checking out the RTP for any game you’re thinking of playing. Generally, the best online casinos will make sure that it is clearly displayed on the thumbnail image of each game. Being aware of the RTP can help you gauge potential winnings as well as help you make informed decisions on the best games to play.

Understanding the RTP of online slots games can also influence your gaming strategy and help you identify games that suit your risk preference. For instance, you can choose to play slots with high RTP as the majority tend to be less volatile, offering small but frequent payouts.

Conversely, you can play slots with low RTP (but highly volatile). Even though the winnings will be less frequent, the payouts can be potentially significant when you land a winning combination. So, choosing between high and low RTP/volatility slots depends on your preferences and game strategy.

Random vs compensated slot machines

The RTP also influences gameplay and potential payouts in gaming machines. Each game should state whether it is ‘Random’ or ‘Compensated’.

  • Compensated slot machines: Perhaps the best way to describe compensated gaming machines is to assume they have some sort of in-built memory. They know how frequently they have paid out as well as when they next need to pay out to comply with their average RTP percentages.
  • Random slot machines: As the name suggests, these gaming machines are random and they depend entirely on statistical probabilities (Random Number Generators), rather than previous outcomes to meet their associated RTP.

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RTP in table games and the house edge

Table games often have some of the highest RTP rates, the reason they contribute less towards the casino wagering. Figuring out the RTP of table games requires you to know the house edge — which is different from slots. As mentioned earlier, the two are literally the opposite of one another, and combining them gets you 100%.

To calculate the RTP of table games, you subtract the house edge from 100%.

i.e. 100% − (minus) house edge.

For instance, assuming baccarat has a house edge of 1.06%, that would make its RTP 98.94%. And if a blackjack variant has a house edge of 0.28%, its RTP will be 99.72%.

Similar to slots RTP, you can use the house edge to determine which table games are the most profitable. Casino games with a high house edge obviously pay out less on average compared to those with a house edge that’s lower.

Below is how house edge for various table games compares:

Table gameHouse edge
American roulette5.26%
Blackjack0.13-2%
Keno20-40%
Baccarat1.01% (and 14.36% for a tie)
Craps0-16.67%
Video poker0.46%

Strategic implications of RTP

There are lots of strategic implications of RTP for players. For one, it can help you make informed decisions. This is primarily because the RTP acts as a guide, offering you insights into the expected outcomes of a particular casino game.

So, understanding RTP helps you choose games with a high probability of offering better winnings or with lower odds. It can also help you manage your bankroll by setting realistic goals and expectations, as well as developing smart gameplay strategies.

The psychological and practical sides of RTP

In online gaming, psychology usually influences the actions you undertake, the choices you make, and responses to outcomes. And one psychological aspect of RTP is the thrill of anticipation. When you choose games to play based on the RTP percentage, a sense of excitement builds up as you anticipate certain potential payouts.

Typically, when you engage with a rewarding activity, your brain releases dopamine, a neurotransmitter in the brain associated with reward and pleasure. This ultimately creates heightened feelings of enjoyment and satisfaction, enhancing your overall gaming experience.

Even with your heightened expectations, you should understand that the RTP percentage in the game you're playing is just an average that has been achieved after a substantial period of gameplay. So you shouldn't expect to win the exact amount indicated by the RTP. Therefore, try to balance both the psychological and practical aspects of the RTP percentages when playing.

RTP, Regulation, and Fair Play

Typically, online gambling platforms aren't obligated to show RTPs of the games they offer. However, every licensed online casino is required to be transparent with the fairness of games.

For instance, if a casino has a game with a different RTP than advertised, it can get in trouble. To avoid such instances, that's why many opt not to directly show the RTP. Online table games, on the other hand, are required to display their RTP on the thumbnail image of the machine or within their software ‘Help’ page.

Meanwhile, online gaming platforms that inform players of the expected RTP rates on their games help to build trust and confidence amongst players. The information also helps demonstrate the casino’s commitment to fair play.

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Conclusion

As detailed in this guide, understating the RTP of games can help you make informed decisions that match your expectations and rewards. To strike the right balance between entertainment and strategic gaming using RTP, ensure you choose games with favorable RTP that minimize risks while maximizing rewards. And in an industry that thrives on honesty and transparency, RTP remains a pillar for responsible gaming and informed decision-making on gambling platforms.

Understanding RTP in Casinos - FAQs

🎰 What does RTP stand for in casino terms, and how does it affect my gameplay?

The abbreviation RTP stands for 'Return To Player,' representing the average amount of money a casino game pays back to players over time. For instance, with an RTP of 96%, if you wager $1, you're likely to get $0.96 back. However, the exact RTP is a long-term average, and short-term variations can occur.

RTP and house edge are interconnected, representing the opposite sides of the same coin. While RTP (Return To Player) indicates the average amount paid to players, the house edge is the advantage the casino has. Subtracting the house edge from 100% gives the RTP. Both metrics help calculate potential winnings and what the casino retains.

💡 How does RTP influence strategic decisions in casino gaming, and what are its psychological implications?

RTP has strategic implications, guiding players to choose games with better winning probabilities. Understanding RTP helps in setting realistic goals, managing bankrolls, and developing smart gameplay strategies. Psychologically, choosing games based on RTP creates excitement and anticipation, enhancing the overall gaming experience.

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