May

10

2017

# Slots and Payback Percentage

Every month, the Mississippi Gaming Commission publishes statistical reports that tell us, among other things, how much slot machines are paying back to players.

In March, for example, non-progressive slots payed 91.16 percent in penny denominations, 93.72 on nickels, 92.41 percent on quarters and 96.81 percent on dollars. The full report includes other denominations as well as progressives, but the Tunica average for all slots was 91.75 percent.

Whenever I relay such information, I get reaction from readers who wonder how that can possibly be right. “When I put \$100 into a machine, I don’t leave with \$90,” they’ll say. “Shouldn’t that percentage be much lower?”

Those who ask that question need to understand that many of the bets they’re making are funded by winnings, and that figures into the payback calculation.

Payback percentage is all money paid out divided by all wagers, with the result multiplied by 100 to convert to percent. Any payout you receive counts on the payout side, even if you then lose it.

Let’s say you start with \$100 and bet \$1 a spin, and that for the first 100 spins you receive \$90 in payouts. For the next 90 spins, you receive \$80. Then you get a nice hit or two, and the next 80 spins take you back to \$100. After that, you decline \$10 each time – 100 spins for \$90, 90 for \$80, 80 for \$70, 70 for \$60, 60 for \$50, 50 for \$40, 40 for \$30, 30 for \$20, 20 for \$10 and 10 with no return.

At the end, you haven’t made \$100 worth of wagers. You’ve bet \$820. And your return isn’t zero, it’s \$720.

You’d had a payback percentage of (\$720/\$820)*100, or 87.8 percent.

You might walk away feeling like you’ve won nothing, but the machine has paid something close to a normal percentage.

Of course, we all feel a lot better after winning sessions. But even in losing times, your payback percentage is rarely zero.