Generating Money by Casino

Casinos have this notoriety of getting as much money from the customer as possible. Although there is some truth to that, casinos barely even get a lot of money in the process.

You see, the casino only earns a percentage of the total earnings and bets that were placed in any given day. They offer some games of chance whereby the average payouts are usually lower than the income that is generated by the wagers.

In this article, I will demystify how casinos such as the newtown casino actually earn money and so that you will understand how they truly generate their income.

The ‘Handle’

You might have heard of the words “the handle” before, especially if you’ve visited some casinos in your lifetime. Well, the term ‘handle’ refers to the total number of money bet that is placed on the table at any one time.

This varies depending on the game that is played. For example, if you play a game of craps, all of the money bets that were placed by the wagers are put to the table and they all contribute to the handle.

How Do Casinos Make Money?Keep in mind that the handle is there whether you win the bet or not. The handler will give you the chips that will denote the money that you’ve put in as your bet.

People often confuse the handle with another term known as the drop but they have different meanings. Whereas the ‘handle is the overall money that is placed on the table, the drop is actually credit that is exchanged for chips.

When you play Blackjack, for example, the total drop will be found in a drop box to the table where all of the bills and credit slips are dropped into.

The House Edge

Since casinos are havens where you can play a couple of games of chance, any statistical advantage that the casino has in each game (and each bet for that matter) is commonly known as the House Edge.

Each game is different and there is always a corresponding percentage that allows you to know how much edge the house has on a particular game.

Other terms that pertain to the advantage are the “casino win” which is just the net dollars that are retained by the establishment after all of the bets are paid. This net payment can actually be a negative amount, especially if the players win more than what the casino holds.

Another term would be the Hold Percentage and it is just the relationship of the drop to the casino win.

The Hold Percentage

How Do Casinos Make Money?The hold percentage can be best explained using the game of Roulette. On a typical American Roulette, the player has a chance of winning by placing a bet on 36 numbers amounting to a total of 38 (if you include both 0 and 00).

The house edge is usually 5.26%, but at the ending of a game, the house would most likely win 20 percent of the drop. That is because the player will usually make more bets than they could repeatedly, which would consequently rack up the income of the house.