Wednesday, September 26, 2012

It is not about the Medium

            I don't think there is a game in the casino more misunderstood than video poker.  Even in the days when slots were mechanical, most people considered video poker to just be another slot machine, but one with a computer screen.  I think many people just think that it was too hard to create a mechanical machine using cards, so they digitized it all, but it still plays like a slot machine - all because the hardware looks roughly the same.  It is NOT the hardware that makes the game.

            This past week, I met a gentleman who told me he likes to play keno slots.  I have to be honest and say I had no idea what he was talking about.  He explained that he picks a certain amount of numbers from 1 to 80 and then the machine picks 20 numbers and he gets paid if the 20 picked includes at least some amount of the ones he picked.  I politely looked at him and said there is nothing 'slots' about what he just described.  He simply was playing keno in video version (hence it is called 'video keno').  He was playing the EXACT same game as if he was playing in a keno parlor marking the little pieces of paper and handing them to the scantily clad woman.  Ironically, the video version of keno tends to pay higher than the old fashioned version because the Player can play far more hands per hour.  I explained to this man that the machine pulls 20 completely random numbers and throws them onto the board.  It does NOT decide ahead of time that you will hit 3 of the 8 you marked and then decide which numbers to pull to make that happen.

            This is in essence the very difference between a slot machine and a video keno machine or a video poker machine or a video blackjack machine.  In the latter three games, the machine uses a random number generator to decide which card to deal or which ball to draw.  You win or lose based on the specific cards/balls it randomly draws.  In a slot machine, the machine first determines whether your will win or lose.  If you are to win, it will decide how much you will win and set the symbols in the appropriate fashion.  If you are to lose, it will decide exactly which symbols to show you - always a losing combination - but potentially set up to make you feel like you almost won. 

            Over the years, when I've been asked what I do for a living and explain that I analyze casino games, a frequent follow up question is if I do it for live games or electronic games.  Since the majority of my work is in table games my response is usually just that, but I tell them it really doesn't matter what medium the game is in.  As long as the game is using essentially a random deck of cards (or ping pong balls) where each card has an equal chance of appearing, it does not matter if you are playing a game with a real life dealer, at a casino on an electronic multi-player table, on a stand-alone machine in the casino or playing at home on some software.

            Video blackjack has existed for years in the casino.  They were not always easy to find, but many Players relished the idea of playing for only $1 per hand and having the same experience (well, mathematically) as playing at a live table.  I would certainly understand those that feel that playing on your own machine is not as sociable as playing at a table, but that's not a mathematical difference. 

            In the past few years, many casinos have added multi-player electronic versions of popular table games (i.e. Shuffle Master's TableMaster games).  These games play identically to the live games.  There are times when for one reason or another the casino chooses to employ different paytables, but the probabilities of winning a hand or losing a hand or being dealt a particular hand remains the same.  Any changes to the payback as a result of paytable changes cannot be sneaked past the Player.  These payouts must all be visible on the machine.   Because the digital cards are as random as real cards, we can always calculate the exact payback of any of these games based on the paytable. 

            While the name "Slot machines" presumably comes from the different slots the wheels are in (well, were in when they were mechanical), and there is a little bit of similarity in the notion that video poker cards are in 'slots' in the machine as well, this is where the similarity ends.  The critical difference between games like video poker and slots is that in video poker your cards are determined randomly and you win or lose based on the pattern of these cards.  With slots, whether your win or lose is determined by the machine and then you are presented with symbols to match the pre-determined outcome.   Slots could never be replicated on a live table, but games like video poker, video keno and video blackjack are (or could be).

Thursday, September 13, 2012

Strategy is Underrated

          I can't stress enough the importance of using the right strategy when playing in the casino.  Over the years, I've heard all sorts of excuses for why people abandon strategy, ranging from it doesn't matter in the short run to some anecdotal story about how someone they know threw strategy to the wind and it paid off massively.  Yeah, that's nice.  If you're a sports fan, you know the importance of having a good coach or manager.  There are reasons why Pat Riley, Joe Torre and Bill Parcells are in such high demand.  Yes, it is because they win.  And they win because the utilize the right strategies for their respective sports.  This doesn't mean that once in a while their strategies won't fall apart.  Nor does it mean that there won't be times that they'll execute their strategy perfectly, yet still the other team will win due to a bad bounce.  I doubt any of these coaches would abandon their strategy over a bad bounce or a single loss.

            The same is true when you walk into the casino.  The coach/manager of your 'team' is you.  You decide which game to play.  This is the first key step in your strategy.  In fact, this leaves you with more power than any of the aforementioned coaches.  I'm sure many of them wish that they could pick their opponent on any given day, but they don't get to.  You on the other hand can decided whether to play slots, video poker or a table game.  If you decide on video poker (always a good choice), you decide which variation and to some degree, which paytable.  You can choose the short-pay paytable or make sure you find the full-pay paytable for the game of your choice.   Joe Torre isn't going to hit the field with only 8 fielders, why should you play jacks or better video poker that pays only 8 for a Full House instead of the full 9?

            Once you decide on your game and paytable, the real nitty gritty part of the strategy begins.  There are 52-cards in the deck.  There are 2,598,960 ways you can be dealt 5 cards from a 52-card deck.  There are 32 ways to play each of these deals, ranging from discarding none of the cards to discarding them all.  You have to make a decision on each of these hands which ones you will keep and which ones you will discard.  Fortunately, in about 75% of the cases, it is fairly obvious which ones you want to keep.  The other 25% is the challenge.  Back to our baseball analogy.  Most of the time, there isn't a lot for the manager to do.  He doesn't really have to tell his leadoff batter to 'get on base' every time he comes up.  I think it is fairly obvious that's what he will be trying to do.

            Unlike the baseball manager who has to outguess the opposing manager and players, the video poker Player doesn't need to outguess anyone or anything.  Video Poker is a game of pure math.  For each of those 32 possible ways to discard, there is a finite number of ways the hand can be completed.  Using computers, we can determine the final hand rank of every one of those hands and determine, on average, how many units the Player can expect to have return to him.  It is true that we don't know exactly which cards will come up this time, but we do know that over time, the actual results will approximate our expected results.  Based on this, we learn that the best play for the Player is to play the hand whichever way results in the highest expected return of units.  We call this 'expected value' or EV for short.

            This concept is used for EVERY single decision made in the casino in every game with any strategy.  The decision to hit or stick in blackjack is decided by which of these two decisions results in the higher expected value.  We Fold on Q-6-3 in Three Card Poker and Play on Q-6-4 because in the case of the Q-6-4, Playing has a higher Expected Value than Folding.  The opposite is true for Q-6-3.

            You are in complete control of how to play these hands.  In the case of video poker, the decisions you make are ones that can result in the machine you are playing having a 100.5% payback or a 96% payback.  One payback means you will win in the long run and the other means you will lose (and lose a lot more) in the long run.

            Does playing the right strategy mean you will win every session?  Absolutely not.  It just means your chances of winning increases greatly.   In today's world, the manager that utilizes matchup charts that show how hitters have done against certain pitchers is likely to be far more successful than one who just feels that now is the right time for a certain pinch hitter - he's due to get a hit.    Utilizing the right strategy is important in a variety of situations.  I can't stress enough that the casino is most definitely one of these situations.

Tuesday, September 4, 2012

House Money Strategy

            A few weeks ago, I discussed a new game that was about to be released called House Money.  Just before the article went to print, I found out that due to a technical snafu, the game did NOT go live in the casino I mentioned in that article.  But, in the ensuing weeks, it has gone live in four casinos (Cannery in LV, Drift on Inn and Great American Casino in Washington and Pala Casino in California) for a total of eight tables.

            As a quick refresher, House Money is a sidebet for blackjack.  On the surface it seems very simplistic.  You make the optional sidebet wager before the hand is dealt.  If you are dealt a 2-Card Straight Flush, a Straight or a Pair, you win.  What makes House Money stand out is what happens next.  You can either just take you winnings and play your blackjack game as normal OR you can take all those winnings and add them to your base blackjack wager.  It then becomes a part of your wager just as if you made it before the hand was dealt.  If you double, you must match the entire wager (unless the casino allows doubling for less).  If you split the hand, you must match the entire wager and be prepared for additional splits and/or doubling.

            Some decisions are rather easy.  If you're dealt a suited K-A (or even an off-suit K-A), there is not much to think about.  You take your winnings and cap your base bet.  If the Dealer has blackjack, no big deal, it all pushes and it is as if you took your winnings in the first place.  If the Dealer DOESN'T have blackjack, then you'll win 3 to 2 for the ENTIRE wager!

            Other decisions will be almost as easy.  If you're dealt a Pair of 10's or Face Cards, you'll always cap your base blackjack bet.  The Dealer will check for blackjack first, so you don't have to worry about losing your sidebet winnings that way.   Sometimes, the decision NOT to cap your wager will be rather easy too.  If you're dealt a 6-7 looking into a 10, you'll gladly take your winnings and know that whatever happens in the base game, the hand can't be an overall loser.

            There are two strategy problems that you are going to come across.  The first are the hands in which the strategy is less obvious.  For example, it may be no surprise that we cap the wager with a 9-10 against a 2 through 8.  But, we also do it against a 9 through Ace.  Yes, you're going to lose some of the hands against a 10 with a 19 but the odds are still in your favor.  It may also be difficult for you to cap your base blackjack wager when you have a 4-5 against an 8.  Yes, you are likely to draw a 10, but there will be times you draw a 6 and are stuck with a 15 against that 8.  You'll have to have the courage to risk busting the hand even with a wager that might be 3-10 times larger than your normal wager!

            The second strategy issue is going to be the double down and even more so, the potential split hands.   If you are dealt a 5-6, you must be ready to cap your base wager and then double the entire amount in order to maximize the payback of the sidebet.   So, if you are a $5 player and you put $5 on the sidebet and are dealt a suited 5-6, you'll win $20 on the sidebet and have $25 to add to your base wager.  You're now a $30 blackjack Player and you have to be ready to put down another $30 in these cases.

            In similar fashion, if you are dealt a Pair of 8's, you cap your base wager against a 2 through 7, which is probably no surprise.  With the Pair of 8's, you'll win $15 on the sidebet and have $20 to add to the base wager, making you a $25 Player.  Now, you have to split those 8's and be ready for the possibility of being dealt a 2, 3 or 8 leaving you with $25 double downs or splits.  You can quickly have $100 on the table.

            But, as the guy who did the math for Shuffle Master for this game, I can tell you that if you want to have a shot at earning the 98.3% payback from the sidebet, you're going to have not only cap your bet at the right times, but once you do, you must play blackjack using standard strategy.  One of the incredible features of House Money is that while it has its own strategy, it does not change basic Blackjack Strategy one bit!

            If you are interested in learning the complete strategy for House Money, I have created a simple 8 1/2" x 11" tipsheet that shows you when to cap your wager and when to take the money.  It is valid for all shoe sizes.  Eventually, I hope to shrink it down to a pocket-sized strategy card that you can bring with you to the casino, but for now, this will have to do.  If you are interested in ordering it, please send a check or money order to Gambatria, P.O. Box 36474, Las Vegas, NV 89134.