Monday, December 13, 2004

Recommended Minimum Bet Size for Casino Bonuses

One thing to keep in mind with casino bonuses is not just the overall dollar amount of the bonus but also the WR, as that determines how much you can potentially expect to earn per hour. A $20 bonus that takes you ten minutes to earn is in some ways superior to a $1,000 bonus that takes 100 hours to complete. It’s pretty subjective, though, and depends on your own personal circumstances. If you really, really need some extra money, and don’t mind grinding through many, many hands, you’d prefer the larger bonus, even if it takes you much longer to complete. If you’re more focused on your hourly earn, you’d prefer the smaller bonus that you can complete quickly.

On a related note, I’d like to present a few different scenarios as far as what your minimum bet should be. By and large (especially for people just starting with casino bonuses) I highly recommend that you start with StarLuck and PlanetLuck, and that for both you bet the minimum $1 on every hand. While that means you have to grind through a lot of hands, the odds are good that you’ll emerge with a nice profit and have a cushion for future bonuses. But let’s look at the math behind that (and future) strategies, with an eye towards hourly earn and overall profits.

You deposit $100 at StarLuck and get a $100 bonus, giving you $200. You have to wager $1,600 total. Betting the minimum of $1, that means you have to play 1,600 hands. Of those 1,600 hands, though, you’ll be splitting and doubling on some, so you’ll probably only have to actually be dealt 1,500 or so hands.

Assuming you’re new to blackjack and consulting the basic strategy often, you’ll probably only be able to play around 200-300 hands per hour. That puts you at 5-8 hours of playing for an expected profit of $90, for an hourly earn of $11-18/hr. (Keep in mind, though, that the point of betting the minimum on the early bonuses is so you have the necessary bankroll later for the bigger $200 bonuses from casinos like Casino-on-Net, where your hourly earn will be $30-40/hr or so.)

Granted, the strategy of betting the minimum on the first few bonuses isn’t going to make you rich. It’s very safe, though, and designed to build a bankroll for you to pursue further bonuses with. Let’s look at the math, though, as far as the risk and reward of betting more than the minimum.

In the above example for StarLuck, if you bet the minimum of $1 there is less than a 0.01% chance that you will lose all your money before you wager $1,600. It’s virtually impossible to bust out if you bet the minimum. If you bet $2 on each hand, there is about a 0.5% chance you’ll bust out. Betting $3 a hand creates about a 2% chance of busting out. Betting $5 a hand is about 4%.

So that’s not so scary a prospect, betting more than the minimum, and betting $5 a hand allows you to meet a WR of $1,600 in just a bit over an hour, as opposed to 5-8 hours if you bet the minimum of $1. Why in the world would I recommend that you bet the minimum, then, when betting $5 only causes you to bust out 4% of the time?

There’s more to it than just busting out, though. Your goal in all this (hopefully) is to make a profit. The more you bet, the larger the short-term swings will be. As your bet increase, so does the variance. If you’re just getting started in casino bonuses and/or on a limited budget, the variance of betting anything more than the minimum can wipe you out, especially at the beginning.

Here’s some math to chew on. Using the same StarLuck example, your expected profit is $90. That never changes, no matter what the size of your bet is. If you bet the minimum of $1 per hand, your standard deviation will be about $45.00. Your results, on average, will be within 1 standard deviation of the expected profit about 65% of the time. So 65% of the time you’ll book a profit of between $45 and $135 when completing the bonus at StarLuck.

Keep in mind that when we say 65% of the time we mean just that, nearly a majority of the time. Not always, not guaranteed, simply 65% of the time, and actual results can still fall outside that range of 1 standard deviation. Or, more simply, roughly one-third of the time your results will fall outside of 1 standard deviation, causing you to make less than $45 or more than $135.

If you bet $2 a hand, your standard deviation is $65.00. So 65% of the time you’ll show a profit of between $25 and $155.

If you bet $3 a hand, 65% of the time you’ll show a profit of between $10 and $170.

If you bet $5 a hand, 65% of the time you’ll show a profit of between -$6 and $186.

So let’s combine all that. If you bet the minimum of $1, 65% of the time you’ll make between $45 and $135. You will essentially never lose all of your money. It will take you about 5-8 hours to complete the wagering.

If you bet $5 per hand, 65% of the time you’ll lose $6 or make $186. You will lose all of your money 4% of the time. You’ll complete the wagering in 1-2 hours.

With that in mind, it’s pretty easy for me to recommend betting the absolute minimum when starting out, especially in a beginning casino bonus strategy guide. While you won’t make as much per hour, you’ll book a profit the majority of the time, with no risk of losing your entire $100 deposit. You’ll slowly and steadily build up a bankroll with no risk to your initial investment. Yes, in some individual cases you’ll be making less than minimum wage, but in other cases you’ll be making $30-40/hr, all from the comfort of your home, all for just clicking buttons on a computer. You’ll also become comfortable with the world of casino bonuses and be positioned to profit even more from more advanced, trickier bonus strategies.

Betting $5 per hand greatly increases your potential hourly earn but it also greatly increases your risk. Not only do you have a decent chance of losing money but you also have a 4% chance of losing everything. Betting $5 per hand places you within 1 standard deviation of losing money. While your expected profit is still $90, you’re just as likely to lose money as you are to make money, given the variance created by betting more than the minimum. Yes, you have the potential to win more, and you’ll complete the bonus much more quickly. You’ll also have the potential to not only lose more, but also the potential to lose everything, that 4% of the time when you’re very unlucky.

All that said, there’s definitely a middle ground. When recommending a strategy to others, I advocate taking the ultra conservative path, betting the minimum, grinding it out and locking in a profit. My own personal strategy, though, is to bet the minimum on the first few and then gradually increase my minimum bet slightly on later casinos, once I build a cushion of profits. But I understand the risks and am willing to risk a bit to increase my hourly earn.

It depends on your bankroll, too, as if you’re starting with $500 (and understand the risks entailed in gambling) you can bet more than the minimum, as your bankroll is large enough to ride out the short-term variance that comes with larger bets. If you bust out on one casino but triple up on the next, you’ll show a nice overall profit. But you have to have a bankroll large enough to absorb the risk of busting out on one or two casinos.

For people just starting out, though, with limited bankrolls, I highly recommend betting the minimum, or very close to it, especially for the first few casinos. You only get one shot at these signup bonuses and it’s important to make the most of it, instead of putting your investment at risk by betting more than the minimum.

1 comment:

Drizztdj said...

I think your guide is great to start a bankroll, thanks again for taking the time to post this information!

You may want to note that for Starluck casino (and probably the other skins) that the hand requirement information does not update instantly. Instead you need to wait a day for it to so. I unfortunately kept playing over my requirement by ($5K :P ) and busted out.

It wasn't a big deal to me personally but for those starting out its good to know it case they're looking for a quick payout.