What is the difference between Odds and House Edge at casinos?
You'll often hear about the odds at a casino or on specific casino games as well as the house edge and while the two terms are often used interchangeably, they really are not the same thing.
The common thread that binds odds and edge together and that differentiates them is the payoff. While odds describe the likelihood of an event taking place e.g. "5-to-1" that a certain horse will win the race or that you'll roll a 7 in craps. Odds can also be mathematically expressed as a term we know as "probability" which is a mathematical value usually expressed as a decimal, percentage or notation like 2/5 or 0.50 or 50%.
House Edge on the other hand shows the statistical fraction of money wagered by gamblers that is taken by the house or casino and it is expressed as a percentage. When it comes to the House Edge, this value will exist no matter who wins or loses and even though the money value doesn't overtly change hands and it reflects the average outcome over the long term and large number of transactions.
The difference as well as relationship between edge and odds can be seen in the game of Roulette. If a player places a "straight-up" bet on one specific number or colour at a European Roulette table (one with a single zero that is) and the wheel has 37 positions where one will be the winning one and the other 36 will be losing positions, the odds of the player winning will be 36-to-1, the probability will be 1/37 (a one in 37 chance of winning). If the wins at the table are standard and pay 35-to-1, over a period of time the player will be able to win once every 37 times. If long term results are tallied and 37,000 spins are taken into account, this will mean there have been 36000 losses and 10000 wins if you're paying 1 Dollar/Euro/Pound per spin that means that the casino will take in $/€/£ 360000 and pay out $35000 and make $10000 and if you divide that by 37000 you'll get $0.27 which what the House makes per bet (this is known as the edge).
While odds can change with the type of bets made in European Roulette and any other games that offer betting options, edge generally remains the same in all cases as payouts are adjusted against the odds.
So while casinos may give you good odds, they always have the edge and that is something to keep in mind every time you play.