Theoretical Formula

So a very open Casino host answered a question I directly asked him....

Blackjack at .015? 60 hands an hour? Pretty fair?


HOST:

I will use the following theoretical formula:


Theoretical = (Average bet x hours played x hands per hour) x (House Edge / 100)

$750 Ave. X 28 hours X 60 hands X .015 = 18,900 is your theoretical

From that theoretical we consider 35% as your earned comps. 18,900 X .35 = $6,615

This is how we handle comps when using theoretical, we also consider 10% of loss, whatever is higher.

This figures are based on 4 hours of play a day, an average of $ 750 and at the game of Black Jack.

Results vary depending of game, time and average bet.

This is about the average to expect. Depending on the property they'll either use the actual loss rate of the blackjack table you play at or they'll use the best rate in the casino (usually the high limit table which the .015 is). 60 Hands an hour is a bit on the low side, but again they want to get as much out as possible.

.015? Huh? What am I missing here?

Quote: AcesAndEights

.015? Huh? What am I missing here?

wondering the same thing

Quote: WoO link, bottom of page

Blackjack - 70 hands/hr at 0.75% (for comps)

https://wizardofodds.com/gambling/house-edge/

The formula seems correct though that 0.15 probably means you were at a very favorable blackjack game in a HIGH LIMIT room.

MOST casinos focus on your "THEO" and you should always know what your ACTUAL theo is, since their records reflect their impressions and estimates about your "theo".

MOST casinos base comps on your theoretical value (ie, expected losses) and only adjust this figure for massive actual losses and less often for massive actual wins. They focus on what you risked rather than how you actually did. Since your long term value to the casino is what you able and willing to RISK, not your personal variance in the short term. The casino focuses on your long term value to them and protects that value by short term actions to keep you happy.

Casinos will generally sweeten your comps a bit for a massive win so as to make you really want to come back. Most casinos will sweeten comps a bit if you had a very impressive and rapid loss so as to make the rest of your stay relatively pleasant particularly if you have a spouse or spouse equivalent with you who expect fancy restaurants rather than fast food joints. However, actual results have to be really spectacular (either as win or loss) before they will depart from their standard formula.

Interesting thread, thanks for starting it, mds. "Theo" is a mystical thing hosts hint at but never discuss directly with clients; at least that's how it is where I go. I have heard the "four hours of play a day" mentioned many times over the years. That seems to be the gold standard for defining serious customers. That is, I believe the play-time parameter in the formula is regarded as more important that it's mathematical weight when hosts evaluate a customer. I have tried to educate some folks about how they are evaluated. They whine about how much money they have lost, thinking that is the only measure of worth. My standard line is, "They only care about how much you bet, your luck or lack of it is your problem, not theirs." That reasoning is seldom believed.

Actually, 0.015 is 1.5%, which is rather high.

Quote: FleaStiff

MOST casinos base comps on your theoretical value (ie, expected losses) and only adjust this figure for massive actual losses and less often for massive actual wins. They focus on what you risked rather than how you actually did. Since your long term value to the casino is what you able and willing to RISK, not your personal variance in the short term. The casino focuses on your long term value to them and protects that value by short term actions to keep you happy.

Although the comps should based on expected loss rather than actual losses - the house does it for different reasons than stated above. If comps are based on actual losses, the house is widely open for systematic exploitation.

Quote: BleedingChipsSlowly

Interesting thread, thanks for starting it, mds. "Theo" is a mystical thing hosts hint at but never discuss directly with clients; at least that's how it is where I go. I have heard the "four hours of play a day" mentioned many times over the years. That seems to be the gold standard for defining serious customers. That is, I believe the play-time parameter in the formula is regarded as more important that it's mathematical weight when hosts evaluate a customer. I have tried to educate some folks about how they are evaluated. They whine about how much money they have lost, thinking that is the only measure of worth. My standard line is, "They only care about how much you bet, your luck or lack of it is your problem, not theirs." That reasoning is seldom believed.

I get that all the time from friends. They lose 3000 in an hour or less and want 3 nights at RFB or RFBI... Just doesn't work that way. Most importantly, to the Casino it's about hours played. As you put in more play time that's when you will lose. You will get comped more but you will lose at the tables. In other words, just pay for your room food and beverage yourself! Why lose 4000 at the tables to get a 200 a night room comped? Short term winners and long term losers. Except if you are an AP. Should be opposite.

Quote: MangoJ

Although the comps should based on expected loss rather than actual losses - the house does it for different reasons than stated above. If comps are based on actual losses, the house is widely open for systematic exploitation.

Actual losses if rather whopping or early in one's stay will merely "sweeten" the comps that are based on a player's theo. The sweetener is modest since in most circumstances only Theo is considered.

Time at Table can be three hours but it seems four is simply more impressive by a profound amount and it is rumored that at the Venetian the four hour mark is critical.

Quote: CrystalMath

Actually, 0.015 is 1.5%, which is rather high.

I think that is a pretty typical number for the typical player (1.5% loss). Remember, there are lots of very bad players and they help us out by losing much more than a basic strategy player would.

Quote: BleedingChipsSlowly

Interesting thread, thanks for starting it, mds. "Theo" is a mystical thing hosts hint at but never discuss directly with clients; at least that's how it is where I go.

Not where I play. Ask a direct question; get a direct answer.

Does the theo change if you are a good blackjack player? If the pit boss sees you hitting A7 vs T, or making some borderline decision that gives away your knowledge of basic strategy can they pencil you in as a 0.28% player?

In other games the edge is pretty consistent throughout the game, so is blackjack the only game where the pit has any say in setting your theo? The only other thing they can peg you for that I can think of is average bet, speed, and time played.

I actually asked a host once how they rate players and he told me that if it's a huge loss very quickly, he can give out 10% of the actual loss, but most times it's a percentage of average bet x time x house edge.

I'm also interested in finding out how hosts see machines. I've had a chance to look at a sheet once with the machine played, theo, actual win/loss, and time played. If machines are set to a certain theo of course I would like to be playing the ones that have the highest theo but great paytables. I'm wondering if they comp based on a % as well.

Quote: djatc

Does the theo change if you are a good blackjack player? If the pit boss sees you hitting A7 vs T, or making some borderline decision that gives away your knowledge of basic strategy can they pencil you in as a 0.28% player?

In other games the edge is pretty consistent throughout the game, so is blackjack the only game where the pit has any say in setting your theo? The only other thing they can peg you for that I can think of is average bet, speed, and time played.

I actually asked a host once how they rate players and he told me that if it's a huge loss very quickly, he can give out 10% of the actual loss, but most times it's a percentage of average bet x time x house edge.

I'm also interested in finding out how hosts see machines. I've had a chance to look at a sheet once with the machine played, theo, actual win/loss, and time played. If machines are set to a certain theo of course I would like to be playing the ones that have the highest theo but great paytables. I'm wondering if they comp based on a % as well.

Many years ago I worked on a pit tracking program that was used by many of the big casinos and we included an option for the pit personnel to assign a skill level to the player. Our system used "High", "Average", "Low". and those adjusted the theo for the calculations.

Quote: CrystalMath

Actually, 0.015 is 1.5%, which is rather high.

Yeah, I was drunk last night and missed the "(House Edge / 100)" in the description of the equation.

I definitely see the 1.5% players or worse when I'm out playing, but I have to think they don't use that for everyone, especially at high limit where they have more people paying attention. If they can tell you're a perfect BS player, they probably adjust your skill level which effects the theo. Like DRich said, probably a few categories and in the highest category is the perfect BS player who just gets the house edge as his theo.

And then if your category goes any higher than that, they know you're a counter and your comps are about to be gone :)

Quote: mds

I get that all the time from friends. They lose 3000 in an hour or less and want 3 nights at RFB or RFBI... Just doesn't work that way. Most importantly, to the Casino it's about hours played. As you put in more play time that's when you will lose. You will get comped more but you will lose at the tables. In other words, just pay for your room food and beverage yourself! Why lose 4000 at the tables to get a 200 a night room comped? Short term winners and long term losers. Except if you are an AP. Should be opposite.

Agree with your post, but what's RFBI?

Quote: AcesAndEights

Agree with your post, but what's RFBI?

Room, food, beverage and Incidentals... Anything left on your room bill including all tips, phone calls anything..

Quote: mds

Room, food, beverage and Incidentals... Anything left on your room bill including all tips, phone calls anything..

Really? I have never heard of that before.

A tip is the one thing I have never gotten comped.

Quote: AxiomOfChoice

Really? I have never heard of that before.

A tip is the one thing I have never gotten comped.

Back in the day, 1960s 70s and 80s they had RFB and RFBI. Don't really think casinos use the letter "I" anymore.