Inside Asian Gaming

INSIDE ASIAN GAMING | May 2008 Impact of different average bet sizes on volatility under an identical $50,000 casino theoretical expectation Probability of “Player A”Winning $300,000 Name Game Hours Hands/Hour Average Bet HouseAdv. Theoretical Loss Player A B.J 20 100 $5,000 0.50% $50,000 Probability of Winning Probability of Losing Winning over % chance Actual Losing Over % chance Actual $0 42.23% $0 57.77% $102,000 27.55% -$102,000 41.92% $204,000 15.96% $300,000 -$204,000 27.29% $306,000 8.13% -$306,000 15.77% $408,000 3.62% -$408,000 8.01% $510,000 1.40% -$510,000 3.56% -$612,000 1.38% Patron’s Actual $300,000 90% Confidence -$470,671 to $370,671 Patron’s Chance of Winning Their Actual or More 8.49% Probability of “Player B”Winning $300,000 Name Game Hours Hands/Hour Average Bet HouseAdv. Theoretical Loss Player B B.J 20 100 $10,000 0.50% $50,000 Probability of Winning Probability of Losing Winning over % chance Actual Losing Over % chance Actual $0 44.49% $0 55.51% $136,000 30.30% -$136,000 40.57% $272,000 18.59% $300,000 -$272,000 26.90% $408,000 10.20% -$408,000 16.04% $544,000 4.97% -$544,000 8.53% $680,000 2.15% -$680,000 4.03% -$816,000 1.68% Patron’s Actual $300,000 90% Confidence -$644,918 to $544,918 Patron’s Chance of Winning Their Actual or More 16.58% Probability of “Player C”Winning $300,000 Name Game Hours Hands/Hour Average Bet HouseAdv. Theoretical Loss Player C B.J 20 100 $20,000 0.50% $50,000 Probability of Winning Probability of Losing Winning over % chance Actual Losing Over % chance Actual $0 46.09% $0 53.91% $187,000 32.10% $300,000 -$187,000 39.41% $374,000 20.28% -$374,000 26.26% $561,000 11.54% -$561,000 15.81% $748,000 5.88% -$748,000 8.55% $935,000 2.67% -$935,000 4.13% -$1,122,000 1.78% Patron’s Actual $300,000 90% Confidence -$891,342 to $791,342 Patron’s Chance of Winning Their Actual or More 26.62% Table Maximums can be used to augment or mitigate the volatility of casino earnings.The tables above illustrate three different types of Blackjack player, with each offering the casino a $50,000 Theoretical Win. To illustrate volatility,“Player A” plays $5,000 a hand for 20 hours,“Player B” plays $10,000 a hand for 10 hours, and “Player C” plays $20,000 a hand for 5 hours. From the casino’s perspective, each player is equally valuable, but presents different degrees of risk for the house. The smaller tables on the right hand side of the larger ones reflect the normal distribution of expected results associated with the standard deviation derived by each style of play. The term 90% confidence is used to give a reasonable expectation of a player’s winning or losing and is meant to account for 90% of all occurrences. The actual results can be outside the limits listed and the degree of confidence can be portrayed at levels other than 90% (e.g. 95% or even 99%). The tables show that “Player C” has the potential to win or lose more money than“Player A”, creating a more volatile situation for the Casino Marketing 46