100% Rebate on Slot Losses

Introduction

 

In the year prior to the writing of this page, I've known of two casinos that offered 100% rebate on slot losses promotions. What this means is that the casino will refund all documented losses on slot machines within the promotional period of time. Usually the refund is given in the forum of free play, and may be broken down in installments, to keep you coming back.

This type of promotion can be very lucrative. This page endeavors to show how much the player can expect to win and what winning goal the player should set.

Strategy

 

If video poker is allowed under a slot rebate promotion, then the player should consider that option. However, if casino management is smart, then they will either exclude video poker or remove the high-denomination games from eligibility. It may be that high-denomination slot machines are the better game to play under a 100% loss rebate promotion, depending on exact rules and game availability.

Normally volatility is the enemy of the advantage player, but when trying to exploit a loss rebate, it is your friend. You don't want the house edge to grind you down, but your goal should be to quickly hit your winning goal, or go bust trying. That said, you should make the largest wagers possible. This will probably be 2 or 3 credits on a $100-denomination single-line game. As an example of such a game, this page is based on the single-line Double Diamond slot machine.

It is critical to know what return the slot machine is set to so you can make a correct decision in regards to your winning goal. Unfortunately, the player is unlikely to acquire this information. High-denomination slots are generally set to pay a higher return. For example, in Las Vegas, $25 and up slots tend to be set to a return of about 95%. However, if casino management is smart, they will temporarily set their machines to a lower return during the promotion. The lowest return most slots can be set to is about 85%. Without knowing any other information, I would suggest being conservative by assuming an 85% return during a 100% loss rebate promotion.

For those unfamiliar with how slot machines work, these returns are just theoretical averages, an no guarantee over short-term results. Each play of a slot machine is independent of the past. The laws of probability dictate that if a machine has an expected win per play of 95% (for example) of money bet, then the more the game is played, the more the actual return of the game will get close to 95%. This is true of any form of gambling. In mathematics, it is known as the Law of Large Numbers.

Example

 

For example, for an 85% machine and 800-credit maximum loss, the table below shows the optimal goal is a win of 120 units, with an expected win of 72.74 units, and a probability of success of 28.05%. However, for practical purposes, notice how the expected win is almost as high for much smaller win goals. Factoring in the Kelly Criterion and the lost time having to return to collect the rebate, I think a reasonable target is about half the optimal winning goal.

For those who don't understand what I mean by a "unit," it means a total bet. In the example above, if you bet 2 credits on a $100-denomination game, then a unit is $200. A winning goal of 60 units would have an expected win of 67.16 credits. At $200 a bet, that would be an expected win of $200 × 67.16 = $13,432.

800-Credit Bankroll

 

In all tables the optimal goal, to the nearest ten units, is highlighted in green.

400-Credit Bankroll

200-Credit Bankroll

100-Credit Bankroll

50-Credit Bankroll

25-Credit Bankroll

Methodology

 

This analysis was done using Double Diamond par sheets and many random simulations. The simulations used a Mersenne Twister random number generator.

Written by: Michael Shackleford