In this article, I want to discuss an aspect of casino bonuses that players sometimes miss – the true cost ie how much the bonus is going to cost you. Nothing, you might say, it’s free money. You’re right, it is free, but you have to pay to get it!
Regardless of the type of bonus – 1 hour free play, 100% match, 200% match, sign-up bonus – at some point it comes down to trying to release a sum of money from the bonus account into your real money account.
The three important elements here are the wagering requirement, the game contributing percentage and the game’s house edge.
Wagering requirement: this is the number of times the deposit plus bonus amount must be gambled. It varies by casino, but is on average between 15 and 30 times – eg Bodog is 15x and Spin Palace is 30x.
Game contributing percentage: this is the amount that each individual game contributes to the wagering requirement. Generally, slots count 100%, so the wagering stays at the basic level. The difficulty starts with games like Baccarat, Blackjack and Roulette. For those games, each casino has its own opinion, but generally the contributing percentage will be 50% or less (Bodog is the exception here as all games count 100%) Take Blackjack, for example, where the percentage is 10%. What this effectively means is that the wagering requirement is actually 300x (100 / 10 x 30).
House edge: put simply, the house edge is the percentage of total bets the casino expects to win in the long term. So in a game with a house edge of 2%, the casino will expect to make an overall profit of 2%.
Putting these elements together, you can see that the wagering requirement and game percentages aim to take your betting to a level where the house edge starts to apply.
However much you gamble, the basic equation you need to bear in mind is this:
Expected loss = Amount wagered x House edge
(eg if you bet 2000 on a game with a 1.5% house edge, you should expect to lose 30)
With a bonus, the amount wagered is dictated by the wagering requirement and the game percentage, so:
Amount wagered = (Deposit + Bonus) x Wagering requirement x (100 / Game %)
In other words,
Expected loss = ((Deposit + Bonus) x Wagering requirement x (100 / Game %)) x House edge
Taking the Blackjack example above (House edge is 0.5% or 0.005), if you’ve received a 100% match bonus of 50, your expected loss is:
((50+50) x 30 x (100 / 10)) x 0.005
which gives you a figure of 150. In other words, the amount you have to gamble in order to release the 50 bonus should, on average, incur a loss of 150!
This is the true cost of an online casino bonus and a clear indication of why you should think carefully before taking up an online casino’s bonus offer.
Bonus promotions are a way to attract new players to the casino. They’re not designed for serious gamblers. It’s important to remember that you don’t have to take out a bonus in order to play at any online casino. But if you do, make sure you know exactly what’s required of you – before you start to play!
About the author: Andy Follin runs Fortune Palace, an impartial online gambling guide for serious gamblers that includes game strategies, reviews of the best online casinos, the latest online casino bonus offers and a detailed deposit guide for ALL players, including those from the USA.