Why I Don’t Play Blackjack

Luxor casino

If there's one game in the casino I'd be tempted to play, it would be Blackjack. And it's because I'm not a gambler. I have no interest in donating my cash to the casino. But I'm told that Blackjack is one of the few games where you can actually win against the house. Sweet. Perhaps we can all quit our day jobs and go play Blackjack. The fact that you can beat the casino with this game deserves some further investigation.

Can you call it gambling?

Look at some probabilities behind Blackjack. It appears that if you play the basic strategies perfectly, you can expect the house to take your money at an average rate of 0.5% to 1.0% per hand played. Not good so far. However, you may be able to pull the advantage to your favor by as much as 2.5% if you learn to count cards very well. Now that's interesting. If you are working with well-established statistical probabilities and executing with exceptional skill and discipline, can you still call it gambling? It's true you can't control the cards you're dealt, but short-term loses should eventually be overcome by the long-term probabilities in your favor, if you go into the game with a large enough stake.

So why hasn't everyone quit their jobs to go play Blackjack? It's because most people will get clobbered. Even for those who do play well, it doesn't bring much of a return. First, you have to memorize the basic strategies and play them flawlessly. Then you have to count cards perfectly and not get caught. When the count is in your favor, you'd have to be careful about how much you increase your bet or you'll catch the eye of the pit boss. I'm told that if you play exceptionally, you might average about $19 an hour in winnings.

Well-considered risk

That's why I don't play Blackjack. Because too much effort is required for too little return. And who wants to spend all night in noisy casino? But do I appreciate that the probabilities of the game are well understood. Stock market statistics are also well-studied. There is a lot of short-term fluctuation and uncertainty in stocks, but the market has tended to return on average about 9% per year for more than a century. And that's through major wars, recessions, economic turmoil and political upheaval.

If the probabilities of investing are well understood and you have a good plan you execute with discipline, it shouldn't be considered gambling. You will certainly face risk, but not the random chance of the casino. Even if all you do is invest in an index fund with a low management fees, you'll do better than most and you should make money in the long term.

Jon Dearden

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