Slots

All slot machines in modern casinos use a random number generator (an “RNG) to determine

the results of each spin. An RNG is a tiny computer that does nothing but constantly generate

numbers. When you push the spin button, that microcomputer selects a number which

determines the outcome. In fact, this happens before the reels have even stopped spinning.

On modern slot machines, the reels are just there for show. From a practical standpoint, you

could put a quarter in a machine, push a button, and have the screen flash: “You lose!” or “You

win $10”. The mechanism that determined the outcome would be the same, but who would want

to play a game like that, especially if you know that the house has a mathematical edge over the

player.

The spinning reels, the sound effects, and the bonus games are all there to make the game more

interesting to play. The chance of getting lucky and winning a jackpot is a real reward, too, but

do not ignore the other aspects of the game. The random number generator is programmed to pay

back a certain percentage of the money paid into it over a period. This percentage that is

programmed into these machines is always less than 100%. If a slots game were programmed to

pay back more than 100% of the money put into it, it would lose money for the casino.

Early slot machines were mechanical devices. They had three metal reels that had ten stops each.

To calculate the odds of a single symbol appearing on a reel, you just divide the one symbol by

the total number of potential outcomes. So, if you had one cherry on a reel, your odds of hitting

that cherry were 1/10, or 10%.

To calculate the odds of getting three cherries, you multiple 1/10 X 1/10 X 1/10 and get 1/1000,

or 0.1%. If the odds of hitting that symbol are the same as all the others, then you have 10
jackpots you can win, which means that your chances of winning SOMETHING are 10/1000,

which is 1%.

Most people would not play a slot machine that lost 99 times out of 100, though, so slot machine

designers added additional, smaller prizes for getting two symbols out of three for certain

symbols. And if they paid out less in prizes than the odds of hitting those jackpots, then those

slots are guaranteed to make a profit overall.

For example, if a prize for hitting three cherries was $1000, you would be playing a break-even

game, but if the prize were $750, it is easy to see how the casino would be guaranteed a profit.

The difference between the odds of winning and the payout odds is where the casino makes its

money.

Modern slot machines use a computer program called a random number generator to determine

the outcomes of the various spins of the reels. This creates an imaginary reel with several

symbols limited only by the program.

A mechanical slot machine with 256 symbols per reel would be huge, too large to play, much

less to build. But a computer can create an imaginary reel with 256 symbols per reel and take up

no more space than an iPod Shuffle.

To make things even more interesting and entertaining, slot machine designers can program

different probabilities for each symbol to come up. Most symbols might come up once every 256

spins, but others might come up twice as often, while still others might only come up half as

often.

This enables slot machine designers and casinos to offer slot machine games with far larger

jackpots than they were able to when they were limited by mechanical reels. And they can offer

these large jackpots and still generate a healthy profit.

The payback percentage is the amount of money that the slot machine is designed to pay out

over an enormous number of spins. This number is always less than 100%. The difference

between 100% and the payback percentage is the house edge, and that is where the casino makes

its profits.

A simple example can help illustrate how this works. Suppose you have a slot machine with

three reels with ten symbols on each, and it only pays out when three cherries hit. The odds of

winning that jackpot, as we determined earlier, is 1/1000.

If we set the jackpot as $900, and charge $1 per bet, the payout percentage for that game will be

90%, or $900/$1000. Of course, no one would play a slots game which only paid out once in

every 1000 spins, which is why there are various smaller payouts programmed in.

The house edge is a statistical measure of how much the house expects to win (on average, over

the long run) from every bet you make on a game. The house edge is a theoretical number that

accounts for the probability of winning versus the probability of losing AND the payout if you

win. All casino games carry a house edge.

If I say a game has a house edge of 4%, this means that over time, you should average a loss of

$4 for every $100 you bet on the game. This is a long run statistical average, though. In the short

run, you are unlikely to see results that mirror the house edge. The return to player and the

payback percentage are the same thing. The payback percentage added to the house edge always

equals 100%. The payback percentage is the amount of each bet that you get back, and the house

edge is the amount of each bet that the casino wins. Again, these numbers are on average over

the long run. A game with a 4% house edge has a 96% payback percentage.

I was playing a $1 machine, and my max bet was three coins, I was risking $3 per spin. 33 cents

are 11% of $3, which means my actual loss was 11%. The machine paid back 89% for the
session. Does this mean that the payback percentage for the machine is 89%? In the scheme of

things, 450 spins are a small sample size. To have any confidence in your statistics, you really

need to have at least 5,000 spins under your belt. Even then, depending on how volatile the game

is, your actual results might be wildly different from the mathematically expected payback

percentage.

Theoretical payout percentages (or return to the player) for slots are the percentages of money

the players get back as winnings. Respectively, hold percentage is the remaining amounts money

the house keeps for itself. Usually, payout percentages for slots make from 82% to 98% and are

set according to the gambling laws.

The payout percentages for each machine are set within computer chips installed when the

machines are manufactured. Certain machines are set to hit more often than others and are called

"loose". In fact, the probabilities for hitting a winning combination still depend on the use of the

slots Random Number Generator, or RNG pre-programmed for every slot machine. Most players

misunderstand the principles according to which the RNG works, which leads to the

establishment of a complete set of myths.

The RNG, which is seen as the "brain" of the slot machine, is a program generating millions of

numbers that will correspond to certain symbols on the reels. The RNG selects values later

translated into sets of numbers defining the winning combinations. These combinations will be

pre-set the very moment the player pushes the "Spin Reels" button or even inserts the coins.

The slot machines odds are different for classic mechanical reel slots and modern video slot

machines. The odds for traditional reel slots are defined by certain mechanical devices. Each reel

accommodates a certain number of symbols, and the chances for hitting a symbol are counted

through dividing it by the total number of symbols on each reel. For example, the chances of
hitting one symbol on a 3-reel slot with 10 symbols on each reel are 9 to 1 (1/10), for two

symbols it is 99 to 1, and 999 to 1 for three symbols in a row.

If every slot machine game in the world had a payback percentage posted on the machine

somewhere, it would be easy to determine which slots pay back the most money. You could limit

your play to machines with a payback percentage of over 95% for example.