Return to Player (RTP) and Variance in Casino Games
RTP and variance are useful together when comparing casino games. RTP describes the theoretical return; variance indicates how often a game may pay out and how large those payouts might be.
What is RTP?
In casino terminology, RTP is comparable to the house edge, but expresses the percentage advantage from the player's perspective. The initials stand for ‘return to player’. Almost all slots have an RTP, while some table games show either RTP or house edge.
In principle, ‘house edge’ can be reframed as ‘player edge’, with the player edge representing a game’s RTP. For example, a blackjack table with a ‘house edge’ of 0.5% would have a ‘player edge’ or ‘RTP’ of 99.5%. Similarly, NetEnt Mega Joker online slot game has an ‘RTP’ of 99%, which can also be described as having a ‘house edge’ of 1%.
As an online casino player, you’ll find that almost all video slot games show an RTP. This figure helps slot players assess how often an online slot may pay out on average.
How Is RTP Calculated?
RTP is based on the same mathematics as house edge, so the underlying equation is the same. As the blackjack example shows, a 0.5% house edge converts to a 99.5% RTP. Both figures come from probability.
The RTP of many casino table games was calculated when they were developed years ago. Blackjack, roulette, baccarat and similar games are in this group. A casino may, however, add a side bet or change a rule, and either adjustment can affect RTP.
Online slots, in contrast, rarely share a single standard RTP. Their reels, pay lines, features, payouts and symbol counts can differ considerably. To calculate RTP, the developer accounts for these variables and uses a mathematical equation to determine the probability of each win.
What is Variance?
Variance, also called velocity here, describes how often a casino game pays out and can indicate the size of a win when one occurs. A high-variance slot generally pays less often than a low-variance one, but its winning payouts are usually larger.
Casino discussions often describe slots as having low, medium or high variance, but every casino game has some degree of variance. Games such as craps and roulette offer different bets, each of which may have its own variance.
At roulette, an outside bet that pays even money or 2 to 1 is an example of a low-variance bet. Inside bets, by comparison, are medium- to high-variance wagers.
Each category is explained in more detail below.
High Variance – High Risk, High Payout
These games do not typically deliver frequent small wins. Several bets may go by without a win, but if a payout eventually comes, it is generally much larger, provided play continues.
Roulette Example: A roulette straight-up bet selects one number, with a 2.70% chance of winning and a payout of 35 to 1. A win is unlikely on any single bet, but the potential reward is substantial.
Slots Example: An online slot may produce few winning symbol combinations for a while, so you may need to wait for its high-paying feature to trigger. It could take some time to reach that feature.
Medium Variance – Medium Risk, Medium Payout
These games pair smaller wins—which can help preserve a bankroll and keep play engaging—with a meaningful chance of a larger win at any time.
Roulette Example: In roulette, a line bet covers six numbers, giving a 16.2% chance of winning and a 5-to-1 payout.
Slots Example: A medium-variance slot may offer respectable base-game wins over time, with feature bonuses appearing fairly regularly. Some of these slots still pay infrequently in the base game, but their two bonus games put them in the medium-variance category.
Low Variance – Low Risk, Low Payout
These games are not usually associated with large prizes. Wins may come often, sometimes in long streaks, though an individual win may not cover the stake. More commonly, the game returns a portion of the bet regularly, with occasional wins multiplying the total value of the bet.
Low-variance games generally pay out often, but at low odds. The odds may be 50/50 or close to 50/50.
Roulette Example: Betting on red or black gives you a 48.60% chance of winning, and pays even money.
Slots Example: Many 243 ways to win and Megaway online slots have low variance. Some regularly pay out for symbol combinations, while their free spins features offer a small number of free spins that are easy to trigger. The result is frequent payouts, though wins are usually modest.
Common Mistakes with RTP, Variance and Variation
RTP is one of the most misunderstood casino concepts. The terms ‘variance’ and ‘variation’ are also often confused.
For example, an RTP of 98% might seem to mean that every €100 wagered returns €98. That is not correct; if the result were fixed, winning sessions or profits would be unusual. Since RTP is probability-based, it is an estimate of the amount a player is predicted to win over an undefined period of play.
Variation/Probability
Variation describes the ups and downs players may call 'running hot' or 'running cold'. RTP is the expected long-term return to the player. It does not mean that a €100 wager will reliably return €98, because variation affects both individual results and sessions.
These examples show how variation can affect probability:
Heads or Tails: In the familiar game of heads or tails, the RTP for winning is 50%, because mathematical probability does not change. Results are not consistent, however: a player could bet on 'tails' and lose 40 times out of 50 flips, then win 85 'tails' bets over the next 100 flips. Every game of chance has variation in its results.
Dice: Dice show the same kind of variation. In theory, probability suggests that high/low or odd/even will occur 50% of the time. A 6 should appear at least 16.67% (1 in 6 rolls), yet 20 rolls could pass without a 6.
Roulette: The same concepts apply to French roulette. A player might keep betting on zero, which has a 37 to 1 (2.7% RTP) chance of appearing on the wheel, but 100 spins could go by without zero before it appears on the next two coups.
Player Errors
Blackjack illustrates a player error. Most Blackjack tables have an RTP of 99.5%, but that figure assumes basic strategy. Without it, the player may give the house up to 5%, while very poor decisions can forfeit 20% RTP or more—for example, splitting 10s despite holding a strong hand worth 20. Blackjack side bets lower RTP further.
Online Slots Variation
Slots differ somewhat from roulette. There is no heads-or-tails, dice or roulette probability baseline to refer to, nor are there mathematical equations or charts like those associated with blackjack's basic strategy. Slots are entirely random, so large wins depend solely on luck.
Each slot uses an RNG (Random Generator) that runs several thousand-reel combinations through the system every millisecond. Pressing the button selects one of those combinations. The visible reels spin only for presentation and to make the game more engaging; the result is determined when you press spin. The reels then stop at the randomly selected combination.
Online and land-based slots work the same way. Therefore, the RTP displayed for slot games provides a rough estimate of your long-term return from playing that slot.
Summary
RTP indicates how much a casino game may pay out over time. ‘Variance’ describes how often payouts may occur and can also suggest their size. RTP is an estimate of predicted long-term winnings based on probability, while variation affects the amounts won and when wins occur.
