The Last Winnable Casino Game in America
By Joe Dungan

Cynical parents or spouses may have drummed into your head that there is no way to beat the house in Las Vegas. "After all," you hear them say, "Look at the size of the buildings. Where do you think that money came from?" While games like keno and slots can yield huge jackpots instantly, the long-term expected return favors the house. Only a relative handful of gamblers can turn profits at games like that, and they only do it one way: being lucky. Even blackjack, the perennial magnet for card-counters, is hardly winnable anymore. Too many people have discovered--and succeeded at--the art of counting cards. With profit margins diminishing, casinos have slowly changed rules to erode overall payback so severely that few "positive-expectation" versions of blackjack exist.

However, video poker has been a winnable game for over a decade. There are a handful of professionals who make a living at it and thousands more who play for fun and profit. While profiting from video poker requires an intricate understanding of it, it is a simple game at its core: five-card draw against a machine. A winning hand is paid a multiple of the original bet according to a posted pay schedule. As in a real poker game, the player is trying for the best hand possible. Unlike a real poker game, he is not trying to beat (or bluff) other people, just trying to get a machine to pay him for winning hands.

Crude versions of mechanical reel poker machines date back to the 1890s. For a nickel, a gambler could spin five reels, each of which had ten different cards on it. Since only fifty cards were represented, gamblers didn't even get the benefit of playing with a full deck. (The two missing cards were usually a ten and a jack from different suits, thus reducing the slim chances of hitting a royal flush even more. This was not an accident.) Eventually, more complex versions were created that allowed gamblers to spin certain reels again, thus simulating discarding and drawing. As the computer age dawned, so evolved draw poker machines. Electronic video versions appeared in the mid-1970s, representing both an increase in speed and a quantum leap in aesthetics. The game's popularity swelled and more variations were created to cater to every taste.

With the unveiling of the game and its many new versions thereafter, probabilities experts quickly pounced on the calculus of each, discovering that some versions, in fact, had a long-term positive return. Put simply, the math goes as follows. Since the number of cards in a deck is finite, the number of possible combinations of deals and draws must also be finite. Therefore, there are a finite number of winning hands and a finite number of losing hands. Since every hand has a fixed payoff corresponding to a posted pay table on each machine, the sum of all coins won when playing every combination of deals and draws can be totaled, assuming the player bets the same amount every time. If this amount is greater than the amount wagered for each of those hands, then the game has a positive return. The longer one plays, the closer the long-term results will match the expected return of the game.

Take, for instance, the original electronic video poker game that spawned its many iterations, known colloquially as Jacks or Better and known by shorthand as JB or JOB. Its pay table is as follows:

Hand                             Payoff on 5-coin bet

Royal flush                                                                4000
Straight flush                                                               250
Four of a kind                                                             125
Full house                                                                     45
Flush                                                                             30
Straight                                                                          20
Three of a kind                                                             15
Two pair                                                                       10
Pair of jacks or better                                                     5

If you play poker, you'll quickly see that the payoffs are consistent with the ranks of hands in a real poker game. Just as, say, a full house is worth more than a flush in a real game of poker, it is also worth more here. This dynamic exists in all video poker games. And while you have the option of betting one to four coins, it is a staple of video poker strategy to bet five coins at all times, because the royal flush payback is disproportionately higher when maximum coins are bet. This higher payback is factored into the long-term expected return of a video poker machine; betting fewer than maximum coins per hand can result in a substantial reduction in long-term expected return. (The same truism about royal flush jackpots almost always applies to other multi-coin versions, such as six-coin and ten-coin, but five-coin video poker is by far the most common.)

Speaking of strategy, how does one exactly go about figuring out what to hold and discard in each situation? Some decisions are obvious but many are not. There is no easy shorthand to know what to do in certain deals, and few people understand probabilities well enough even to approximate the math in their heads. However, such situations (and they occur constantly) have been accounted for by video poker professionals and translated onto strategy cards. A few versions of these are for sale in Las Vegas and on Internet sites--and they are legal to use in casinos.

In addition to having strategy cards at one's disposal, it is also advisable to practice these games at home. There are free versions to play online, but more helpful are the simulators you can download for about $30-40. Not only can you play a variety of versions of video poker, but the simulators let you know when you're making the wrong hold and how much that mistake will cost you, as well as the overall expected return of any given version and your particular efficiency at it.

Also vital is to check the pay table of the game you want to play before you play it. Most commonly, casinos will feature games with reduced pays for full houses and flushes, knowing full well that the average gambler doesn't take the time to compare pay tables. (It is not uncommon for casinos to place a full-pay game just one bank--or even one machine--away from a short-pay version of the same game.) Since the traditionally highest-paying version of JB--also called "full-pay JB"--returns 9-to-1 for a full house and 6-to-1 for a flush, this is referred to as 9/6 JB. Its many variations include 9/5, 8/6, 8/5, 7/5, and even worse, all of which have much lower long-term expected returns simply because of lower full house and/or flush payoffs.

While all experts agree on the importance of correct strategy, there is little universal agreement on the issue of bankroll. Questions as specific as, "How much money do I need to play 9/6 JB at the 25-cent level and enjoy only a 5% risk of ruin?", can be answered by bankroll calculators available on video poker-related Internet sites. Simpler answers include the one by gambling veteran Avery Cardoza, who has written or published dozens of gambling books, including those on video poker. He states that you should have enough to cover 60 hands per gambling session multiplied by the number of sessions you play in a trip. A quarter player, then, gambling $1.25 per hand, would need $75 per session, or $225 for a trip comprised of three gambling sessions.

A more conservative, if non-specific, sum is used by Bob Dancer (www.bobdancer.com), columnist, author, teacher, and one of about fifty video poker professionals in Las Vegas: three to five times the payoff for a maximum-coin royal flush. On most quarter video poker, the five-coin royal flush pays $1,000, translating to a $3-5,000 bankroll. As he writes in his book, Million Dollar Video Poker, which chronicles his journey from a $6,000 bankroll to one million dollars, "The rule is greatly simplified. It understates the bankroll needed for highly volatile games and overstates the bankroll needed for games returning 101% or more. Nevertheless, this is the only bankroll rule I have ever used."

Volatility, often interchanged with the term "variance," refers to the swings of streakiness inherent in all casino games. Blackjack, for instance, has a low volatility; most hands result in either double or nothing. Video poker has a higher volatility than blackjack because losing hands occur more often, and winning hands can pay any number of times more than the original bet and occur with wildly varying frequency and infrequency, all of which contribute to inevitable slumps and winning streaks. Forgoing the complex mathematics behind volatility and the significance of its values, suffice it to say that video poker variations that pay more for higher hands in exchange for lower paybacks for lesser hands have higher volatility than other video poker variations and therefore require higher bankrolls.

So, if you practice on a simulator and keep a strategy card handy while doing the actual gambling and have a sufficient bankroll to sustain your gambling during the slumps, the Jacks or Better game above, if you find one and play it perfectly, you can reasonably expect a long-term return of 99.54%. That's right, even the professional who plays perfectly for years will likely suffer a loss at this game. How, then, does one actually make money at it?

One way is to avoid negative-expectation games like 9/6 JB. There are other variations of video poker that, even when not played with perfect strategy, have a long-term expected return of over 100%. (See sidebar.) Furthermore, some video poker games feature a royal flush payoff known as a progressive, a jackpot that grows in proportion to the amount of gambling done on that machine (or bank of machines tied to the common jackpot), thus increasing that machine's long-term expected return. Says Dancer, "A professional player will not play a game where the house has the edge," a sentiment echoed by many knowledgeable non-professionals as well.

But winning at a positive-expectation game is only part of the story. Most casinos have a facility called a slot club and anyone with a photo ID can join one. In return, you get a small plastic card with a magnetic strip on the back, not unlike a credit card. When you insert this card into a video poker machine, it records your play and relays that information to a central computer. (It works for other games too.) The slot club offers gifts or even cash back based on the amount you gamble, not the amount you win or lose.

Say, for instance, you find a casino with both 9/6 JB and a slot club that returns 0.25% cash back. Let's also say you're enjoying one of the casino's promotions, such as playing on a day when the casino is offering triple points. This means that the slot club returns 0.75% cash back. With perfect play and the slot club cash back program, you are now playing a positive expectation game: 99.54% expected return from the game plus 0.75% cash back equals 100.29% payback. Furthermore, after you sign up at a slot club, casinos will send offers by mail for free rooms, free food, and "bounce-back" certificates of varying amounts that can be redeemed for cash when you come back. This is all on top of the free drinks and other complimentaries casinos routinely offer while you're there. The value of such extras can turn negative-expectation games into positive ones, and make positive-expectation games even more lucrative.

But there is still more to be gained than what's offered by slot clubs and casino marketing departments. Just ask Jean Scott, also known as the "Queen of Comps." Her one-time gambling hobby has blossomed into a second career and cottage industry (www.frugalgambler.biz), encompassing both video poker and the art of scoring the many freebies offered to gamblers. Her two books on the subject go into great detail about how to maximize the amount of free food, drinks, rooms, show tickets, services, and transportation that can be had from casinos and their promotions, coupons, and contests--and hosts, who have the power to offer numerous discretionary comps that do not count against your slot club account. The short answer, as she writes in The Frugal Gambler, is simple. "The single-most valuable word in a casino, the critical three letters that have taken me farther in casinos than any others, are 'A-S-K.' You have to make them aware that you want something and that you're entitled to it."

However, as in the case of blackjack, a growing number of gamblers are succeeding at video poker, a fact that hasn't gone unnoticed by casino executives. They are reducing pay tables and eliminating some games entirely, as well as cracking down on perennial winners. "It used to be the casino's belief that winners were just 'lucky,'" says Scott. "Now the executives are much more knowledgeable about advantage players--and are pulling players' cards and/or taking them off their mailing lists."

So, are the days of winnable video poker numbered?

"If they are numbered, no one knows that number," says Scott. "It is getting harder to make a profit, but someone who scrambles can still do so at any level from quarters on up, although the profit figure may be smaller than in the past." She adds, "Although the 100%+ games are getting more scarce, promotions and club benefits, especially bounce-back cash, are getting better because of casino competition."

Regardless of the video poker climate, Bob Dancer's best guess is that profitable opportunities will continue to exist for the learned player. "I've heard many players complain that games were better in the 'good old days.'...You can piss and moan that things aren't the same or you can buckle down and keep up."

SIDEBAR: THE MAIN VARIATIONS

Among the many variations of video poker created, here are five of the still-available main ones, with their expected return for perfect play and relative variance. Note also the full house/flush payoffs in the names of the first three games listed.

8/5 Bonus Poker

Similar to 9/6 JB, offers lower full house and flush paybacks in exchange for higher returns on certain four-of-a-kinds (also known as "quads"). Four twos, threes, or fours: 40-1. Four aces: 80-1. Expected return: 99.17%. Variance: low.

10/7 Double Bonus

Pays only even money for two pair, but exactly twice as much for quads than in Bonus Poker. ER: 100.17%. Variance: medium.

10/6 Double Double Bonus

Similar to Double Bonus, but increases the paybacks even more for some quads with the presence of certain fifth cards, also called "kickers." ER: 100.06%. Variance: high.

Deuces Wild

With all four twos acting as wild cards, winning hands are easier to get in this variation, but they pay less (except natural royal flush); two pair and jacks or better don't pay at all. But five-of-a-kind, royal flush with wild cards, and four deuces are generous winning hands. ER: 100.76%. Variance: medium.

Kings or Better Jokers Wild

With only one wild card instead of four, winning hands pay more than in deuces wild, and kings or better and two pair pay even money. ER: 100.65%. Variance: medium.