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Slot Machine Odds: RTP, Hit Frequency, and Volatility Explained

Round Head IconApril 1, 2022 - CasinoBloke

Despite the overwhelming popularity of online slots, many players are not yet familiar with concepts such as slot odds, RTP, and volatility. To be specific, most of us have heard of RTP and understand that we want it to be as high as possible – but how does it actually work? What are the odds of winning slot machines? How does volatility work in slots, exactly?

If you ever needed the answer to any of those questions, you’ve come to the right place. The Casino Bloke takes a deep dive into the math of slot machine odds, house edges, and more.

What is RTP in Slots?

RTP stands for Return to Player and it describes the percentage of the stake that is paid out to the player on average. For instance, let’s say you’re betting £100 on a 95% RTP game. On average, you should be able to walk off with £95.

As you may have noticed, the RTP in online slots is always below 100%. Remember, folks, the number one rule of gambling is that the house always wins. That’s why this expected loss for the player is also called an online slot house edge. The house edge in slots is calculated by simply subtracting the RTP from 100. For instance, a 95% slot would have a 5% house edge.

The important thing to understand about slot machine RTP is how averages work. The house edge does not mean that you always lose while playing slots. Calling back to our previous example, you can have a scenario where one player loses everything while another wins £195. In this case, the return to the players is still 95% on average.

Online slot house edge does not mean that you can’t win, but it does mean that you’re statistically more likely to lose. Moreover, the more you play the less you’re likely to walk away with a bottom-line profit. Remember your rule of averages. The more you keep spinning, the more “average” your bet history becomes, and the closer it is to the RTP.

How Does RTP Work in Slots?

Before you ask – yes, slots are “fair” and not “rigged.” At least proper, legal ones are. The reason you’re more likely to lose is because the games were intentionally created that way. That’s why all casino games expressly state their average RTP.

How RTP works depends on the game itself. For example, in online roulette, the zero green pocket(s) are purely responsible for the RTP. The extra 0 slightly decreases the chances of all other bets winning. However, the payouts remain the same as if there was no zero, which puts them at a negative betting value.

Unfortunately, however, things are that clear with maths in online slots. We can explain the basics of slot math through an example, using classic fruit machines.

The old slot machines used just 3 reels in a single row. Each of these had 20 symbols and a system of springs that made them stop.

This means that such a slot machine would have 8,000 possible outcomes – 20 x 20 x 20. Spinning a slot machine 8,000 times would theoretically result in every possible combination once. This is often referred to as a slot cycle.

There are a few ways in which slot makers can turn this system into a profitable one. The idea is to calculate the number of winning combinations, factor in how much they win, and then compare it all to the number of losing combinations. For example, it takes 10 losing combinations to “balance out” one that pays 10x. Then, ensure that the whole equation comes out slightly in the casino’s favour.

Of course, we’re grossly oversimplifying here. Modern online slots simulate the process digitally using RNG, or Random Number Generation. However, the gist of how slots work remains the same.

What Is a Good RTP in Slots?

If we were to pick one, the average RTP in online slots is around 96%. Technically, anything above that is a good deal. There are some important things to note here, however.

First of all, average RTP rates have been steadily increasing over the years. The level of competition is growing rapidly, so the software providers are opting for smaller cuts of the profits to attract new players. Moreover, this has been exasperated by the spread of online slots. RTP rates are now more apparent than ever before, and players are actively seeking higher RTP slots.

The issue with calculating good slot RTP is just how complex modern games are. Multiple reels, rows, thousands of paylines, wilds, scatters, free spins, multipliers… The list goes on, and each of these elements is a big part of the equation. And it only gets harder if you throw in progressive jackpot slots.

In short, everything above 97% can be considered a high payout slot machine. Above 98% or even 99% is almost impossible to find, but quite incredible if you do.

Hit Frequency

This point is actually quite easy to understand, so we’ll be quick.

Hit frequency in slots is simply the percentage chance that a spin will be a winning one. Hit frequency does not take into consideration the amount every spin actually pays out. That means that a slot with a high hit frequency is not necessarily a high RTP slot. It does, however, relate to volatility.

Slot Volatility

Volatility or variance in online slots describes how the potential winnings of a slot game are spread out. Some will say that it relates how often a win triggers, but that’s called hit frequency. Volatility is a noticeably more complex notion.

Let’s first describe what it means for a slot to be volatile. In laymen’s terms, a volatile slot pays out rarely but with big rewards. Slot makers achieve this in one of several ways:

  • Slots with a very low hit frequency will be volatile.
  • Games in which most winnings are small – smaller than the stake – can also be volatile. However, this is balanced out by a few rare but big potential wins.
  • Volatility can also be facilitated through special features or multipliers. For example, a game may give low payouts on average, but with mechanics to stack multipliers that improve returns.

Note that high volatility does not mean high/low RTP. Online slot variance merely refers to how wins are “spread out” within a payout structure of an online slot game.

For example, let’s say you have an imaginary slot that has a 1% chance of winning but pays 97x. Based on what we described above, such a game would have 97% RTP. It would also be extremely volatile.

On the flip side, let’s say you have a slot with a 48.5% hit frequency. However, every win pays just 2:1. This slot would also have 97% RTP. However, it’s a textbook example of a low volatility bet.

As such, the best volatility level in slots is entirely up to you. This aspect of slot games is important for the experience of what the game feels like. However, it does not necessarily relate to profitability.

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