House edge vs RTP vs margin: Three Numbers That Are Not the Same

Most players know what `house edge` (or `house advantage`) is, and many have heard of `RTP` (Return To Player). But the numbers represent different concepts.

Slot games and video poker are passive: you bet, spin, or draw, and the odds pay out according to a fixed set of probabilities. That RTP is a fixed return percentage that the game is set to pay out over the long run.[REF]11,13[/REF] RTP is always quoted as a percentage of the amount a player can expect to win back from his stake over a long session, and a game's house edge is the mirror image of its RTP: as an algebraic formula, House Edge = 100% - RTP, meaning that `RTP and house edge always add up to 100%`.[REF]2,8,9,10[/REF] If a slot game has an RTP of 96%, its house edge is 4%.[REF]3,6,8,10[/REF]

But the house edge is a casino-mathematics term, and RTP is a casino-marketing term - both are described as the casino's built-in which defines how much the casino expects to win over many plays [REF]5,6,12,13[/REF], but only RTP is quoted.

Table games are active: you bet, but the way you play affects the payout probabilities. A game's house edge is built in, but if the player makes the right strategic decisions it affects which probabilities each play will use. Expectations for deciding `RTP` and `house edge values` mirror the difference: RTP describes the passive share a player wins, while house edge is the active share a casino expects to keep.[REF]6,7,12,13[/REF] But mathematically, `House Edge is still the difference between 100% and RTP`.[REF]2,9,10[/REF].

In sports betting, bookies quote an `margin.` This margin describes the effective difference between the bookmaker's offered odds, and the correct odds which correspond to the true likelihood of the outcome. An accurate way to put it is too `overround' - how much the odds have to overstate the probabilities for the bookie to guarantee a profit.

But can you compare the slot's RTP, the table's house edge, and the bookie's margin?

Only if you fix a similar betting basis. In the same way as odds describe different kinds of wager - fixed odds, fractional, decimal, implied probabilities - slot RTP, table game house edge, and sports betting margin are all normalized to a single odds basis before they can be compared..

[REF]11,12,13[/REF].

Remember these key points:

• RTP and house edge are always quoted in casino math, never in a sportsbook. -
• Each defines the expected outcome hinted by any active decision, but both are due to the casino's built-in edge. -
• Baseball bettors, take note: The information you have read here applies to casino table games, not to sports. -
• Margin is still active, too, because each bet has its own odds, but you can only compare casino house edge and RTP on a normalized basis. -

You can convert casino quotations. But sportsbooks still need a source defining margin in.