Friday, April 12, 2013

Slots never due, so don't chase losses

Those who have read me for very long know that one of my running themes is that a slot machine is never "due." to hit. From time to time, I send out a warning to slot players that they shouldn't expect a slot that has been cold for hours to suddenly start paying out the big bucks.

Some things apparently can't be repeated often enough.

I once received a phone call from a woman who'd had a bad day at the reel-spinning slots. Actually, "bad" doesn't begin to describe it. Awful, horrendous, disastrous is more like it.

Normally a table games player - she likes roulette - she recently decided to play a $5 three-reel slot machine. The machine took two coins at a time, so she was betting $10 on each pull.

And cold? Better she'd just given her money to the cashier and left the casino. Because after she lost what she had brought with her, she started drawing money against her credit cards. That's expensive money, with a hefty charge off the top being added to any credit card interest.

Before it was over, she'd lost . . . well, her initial message said $4,000, but when I spoke with her
later, the amount had grown to about $7,000.

"This machine was paying out nothing," she said. "I kept playing because I figured it was due. It had to give me something back. I played that machine for hours," she said, "and it didn't pay out anything like 95 percent."

And when it didn't give her anything back, she thought something was wrong with the machine. She complained to the casino, and she complained to the gaming board . When both told her there was nothing wrong with the machine, that it's normal for a machine to stay cold for long stretches, she complained to me.

Then it was my turn to tell her there probably was nothing wrong with the machine, and that it's normal for a slot machine to stay cold for long stretches, especially on three-reel games with low hit frequencies. Those frequent payoffs for less than our bets do tend to stretch out play, and bonuses on video games help soften the losing streaks.

Our player, unfortunately, was operating under a couple of misconceptions that, coupled with some poor money management, made for a day of casino hell. Here's where she went wrong:

**Cold machines can stay cold: In today's microprocessor, random number generator-controlled slots, your last pull, or your last 10, or last 100, have no effect on your next pull. If the top jackpot is programmed to come up an average of once per 10,000 pulls, then the odds of hitting it on the next pull are 1 in 10,000. That's true even if you've been playing all day and have counted 10,000 pulls without a jackpot, and it's still true if you've hit the jackpot on the last pull. The odds of hitting any particular combination are the same on any given pull, regardless of whether that combination was last hit one pull ago or 100,000 pulls ago.

There is nothing in the programming that would tell a machine to suddenly start hitting if it's been cold for hours. If a machine has paid out little all day, the most you can say about it is that it's been paying out little all day. There is no way to tell if it's going to stay cold or turn hot over the next few hours.

**Payouts vary wildly in the short term: In a period as short as the 10 or 12 hours this woman said she gambled, a machine can pay out 50 percent or less. That would lead to big, fast losses for a day, but the machine still could easily pay out 95 percent for the month, which is about normal for a  $5 three-reel game. A machine that pays out 50 percent for 10,000 pulls would have to pay out only 96.55 percent for the next 290,000 pulls to average 95 percent for 300,000 trials.

Our gambler, if she played 10 hours, was losing about $700 an hour. It's pretty easy to play 500 pulls an hour - really dedicated slot fanatics play faster. So let's say at two coins at a time for 500 pulls, she was risking $5,000 an hour. Her $700 hourly loss represents 14 percent of her wagers.

Far from having to sink as low as 50 percent, a machine could gobble up the funds that fast while paying 86 percent.

**Money goes faster on slots than on tables: Borrowing money to gamble is a bad idea no matter what your game. And slot players must remember that their game is the fastest in the casino, far faster than even craps.

With $1,000 in your pocket, it might be tempting to try the $5 machines. But if the losses mount early, it's far better to switch to $1 slots or even quarters than to dig for more money.

If she were playing roulette, her favorite table game, at 45 or 50 spins an hour, our player would have had to bet $100 per spin to risk as much per hour as she risked on the $5 slots. A $5 slot player is every bit as much a high-roller as a $100 blackjack player; in fact, the $5 slot player's expected average losses are higher.

Early in the day, our player was offered a complimentary dinner in the casino's high-end restaurant. It's the least they could do.

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