Explaining the House Edge in Baccarat: What Is It and Can Players Reduce It?

Eddie Griffin

Written by: Eddie Griffin

Last Updated: Sun Dec 15, 2024, 13:36 PM

Read Time: 10 minutes

Baccarat is celebrated for its simplicity, elegance, and favorable odds compared to many other casino games. With roots tracing back to 15th-century Europe, the enduring appeal of baccarat lies in its straightforward mechanics and the relatively low house edge. Those traits make it a favorite among novice and experienced players alike.

Elsewhere, we broke the house edge in blackjack and the house edge in roulette. Here, we explore the house edge in baccarat, providing insights into how it operates, why it varies between bets, and tips to make informed wagering decisions when you are playing at the best crypto casinos, such as Lucky Red Casino and OnlineCasinoGames.

What Is the House Edge in Baccarat?

In casino gambling, the house edge is the statistical advantage the casino holds over players, ensuring profitability over time.

Expressed as a percentage, the house edge represents the average amount a player can expect to lose per bet. For instance, a house edge of 1.06% means that for every $100 wagered, the player can expect to lose $1.06 on average.

The house edge is an inherent feature of all casino games. It is designed to ensure sustainability of gambling operations.

However, in baccarat, this edge is notably lower than in many other games. This makes the game particularly attractive to players seeking better odds at both land-based casinos and real money online casinos.

What Is the House Edge of the Three Main Baccarat Bets?

Baccarat offers three primary betting options: Player, Banker, and Tie.

Each of these betting options comes with its own odds and house edge, which are influenced by the game’s rules and payout structures.

Banker Bet

  • House Edge: 1.06%
  • Odds of Winning: Approximately 45.86%

Statistically, the Banker bet is the most favorable betting option in baccarat.

Why is this the case? It is because the Banker hand benefits from acting last and adhering to specific drawing rules.

However, to offset this advantage, casinos typically impose a 5% commission on winning Banker bets. Even with this commission in mind, the Banker bet remains the optimal choice for minimizing losses over an extended period of time.

Player Bet

  • House Edge: 1.24%
  • Odds of Winning: Approximately 44.62%

The Player bet lacks the slight statistical advantage of the Banker bet. However, it offers a straightforward 1:1 payout.

While it’s slightly less advantageous than placing a Banker bet, the Player bet represents a solid choice with a low house edge compared to other casino games.

Tie Bet

  • House Edge: 14.36% (based on an 8:1 payout)
  • Odds of Winning: Approximately 9.52%

In baccarat, the Tie bet offers the highest payout but comes with a steep house edge.

Its infrequent occurrence and unfavorable odds make it the riskiest option. Experienced players often avoid this bet altogether, and new players should take note of that.

What Factors Influence the House Edge in Baccarat?

Several elements impact the house edge in baccarat. Let’s look at a few of them.

  • Number of Decks: Most baccarat games use eight decks. This slightly influences the probabilities and outcomes. Variations with fewer decks can marginally affect the house edge.
  • Commission Rates: While 5% is the standard commission on Banker bets, some casinos offer reduced rates. This further enhances the appeal of this bet.
  • Payout Structures: Some variations of baccarat adjust payouts for Tie bets, which can significantly impact the house edge.

Understanding Baccarat Rules and Probabilities

To appreciate the dynamics of baccarat, it helps to understand the rules governing how cards are dealt, as well as how hands are scored.

Baccarat is played between two hands: the Player and the Banker. Each hand receives two cards, and the goal is to achieve a total as close to nine as possible.

Baccarat Card Values

Aces count as one, tens and face cards as zero, and all other cards retain their face value.

Baccarat Drawing Rules

If neither hand achieves a natural (a total of eight or nine) from the initial two cards, additional cards may be drawn according to predefined rules.

The Banker’s actions depend on the Player’s total. This gives the Banker a slight advantage.

This structured approach ensures that the game’s outcomes are predictable and statistically balanced. That contributes to the low house edge for Banker and Player bets.

Baccarat Side Bets and Their Impact on House Edge

Many baccarat games include side bets to add excitement.

Examples of baccarat side bets include betting on pairs, specific card combinations, or outcomes like a “Perfect Pair.”

While these bets may be enticing due to their higher payouts, they often come with significantly higher house edges. In some instances, the house edges exceed 10%.

  • Player Pair and Banker Pair: House edge around 10.36%
  • Perfect Pair: House edge approximately 13%

Side bets may enhance the thrill of baccarat, but they are generally not advisable for players aiming to maximize their long-term winnings. Instead, these side bets are best viewed as occasional indulgences rather than a core strategy.

Advanced Strategies for Managing the House Edge

  • Stick to Banker Bets: The Banker bet’s low house edge makes it the most logical choice. This is even with the 5% commission. Over time, this bet provides the best opportunity to reduce losses.
  • Avoid the Tie Bet: Whether you are living it up in Vegas or relaxing on the couch at home with live dealer games at Wild Casino, stay away from this bet. Its high house edge and low probability of occurrence make it a poor choice for serious baccarat players.
  • Understand Variants: Be aware of specific rules or variations that may affect payouts or commissions. For instance, some casinos may offer promotions or reduced commission tables. This can improve your odds as a player.
  • Bankroll Management: Set strict limits for your play sessions and stick to them. A disciplined approach can help mitigate losses and prolong your gaming experience.
  • Play at Reputable Casinos: Ensure fair game mechanics by choosing licensed and regulated casinos. If you are playing online, carefully research the best online casinos. Look for casinos with transparent rules and favorable conditions.

Comparing Baccarat’s House Edge to Other Games

Baccarat’s low house edge is a significant factor contributing to its popularity.

Here is how the house edge in baccarat compares to the house edge in other popular casino games.

Blackjack

  • House Edge: Ranges from 0.5% (with optimal strategy) to 4% (casual play).

Blackjack offers slightly better odds for skilled players who use perfect strategy. However, it requires a deep understanding of the rules, strategies, and nuances across variants such as American blackjack and European blackjack to achieve the lowest house edge.

Roulette

  • European Roulette: House edge is 2.7%.
  • American Roulette: House edge is 5.26%.

Compared to baccarat, roulette has a higher house edge. This is especially in American roulette, which has an additional double-zero pocket.

Craps

  • House Edge: Varies depending on the bet. Pass Line and Come bets have a house edge of around 1.41%, while some proposition bets exceed 16%.

Craps offers a mix of low and high house edge bets, but it can be overwhelming for beginners due to the complexity of the betting options.

We recommend practicing with free games before diving into some of these complex betting options in real money games. For example, Lucky Red Casino offers practice craps.

Slots

  • House Edge: Typically ranges between 2% and 10%, though it can be higher in some cases.

While the element of skill can come into play in blackjack and baccarat, it does not play a factor in slots games. This contributes to why slots have a higher house edge than baccarat and makes slot machines a less favorable choice for players seeking consistent outcomes.

Video Poker

  • House Edge: Ranges from 0.5% to 5%, depending on the game variant and player strategy.

Video poker combines elements of slots, but it also rewards skilled play. As such, it offers some of the best odds for players familiar with optimal strategies in video poker.

Video poker games like Jacks or Better have a house edge as low as 0.5% when played perfectly.

Keno

  • House Edge: Typically ranges from 20% to 35%.

Keno is one of the highest house edge games in the casino. Its appeal lies in the potential for large payouts, but the odds are overwhelmingly in favor of the house. This is not to say that you should avoid keno, but you should exercise caution and gamble responsibly when you do play.

Compared to baccarat, keno is far, far less favorable for players aiming to minimize losses.

Poker Variants

In poker games like Texas Hold’em, the house edge is replaced by a rake (a percentage of the pot). However, skill levels among players can significantly influence outcomes.

As you can see, the simplicity and low house edge of baccarat, especially on Banker and Player bets, make the game an appealing choice compared to these alternatives.

Conclusion

Baccarat’s charm lies not only in its elegance but also in its player-friendly odds.

By grasping the nuances of the house edge and implementing strategic betting practices, players can approach baccarat with greater confidence and enjoyment.

Beyond the numbers, baccarat offers an experience steeped in tradition and sophistication. This makes it a unique choice among casino games.

Whether you are seeking the thrill of high-stakes action out and about at a casino or enjoying a chill game at one of the best baccarat sites from the comfort of your couch, understanding the mechanics and probabilities can enhance your appreciation of the game. While no strategy guarantees success, informed play helps players maximize their chances and savor the journey.

In the broader context of gambling, the game of baccarat exemplifies how skillful choices can bridge the gap between entertainment and strategic gameplay and provide a rewarding experience for both novice and seasoned players alike.

Learn About the Best Online Casinos

Other Casino Content

In addition to our catalog of sports betting guides, we now have a collection of casino content that covers the basics of casino gambling, including this guide to the house edge in baccarat.

If you would like to learn more about everything from online casino terminology, to how to play popular table games such as baccarat, to tips for responsible gambling, we have you covered.

Also, if you are looking for a new site to play casino games, check out our reviews of the best online casinos for U.S. players and the best real money online casinos., as well as our rundown of top crypto casinos.

Baccarat House Edge FAQ

What is the house edge in baccarat?
The house edge in baccarat varies depending on the type of bet. The Banker bet has the lowest house edge at 1.06%, followed by the Player bet at 1.24%. The Tie bet has a significantly higher house edge of 14.36%, making it a riskier option for players.
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Why is the Banker bet considered the best option in baccarat?
The Banker bet benefits from acting last and has slightly better odds of winning (approximately 45.86%). Even with the 5% commission on winning bets, it has the lowest house edge of 1.06%, making it the most favorable choice for minimizing losses over time.
Are baccarat side bets worth it?
Side bets, such as Player Pair or Perfect Pair, offer higher payouts but come with significantly higher house edges—often exceeding 10%. While they can add excitement, they are not advisable for players aiming to maximize long-term winnings.
How does baccarat's house edge compare to other casino games?
Baccarat offers one of the lowest house edges among casino games. Blackjack can have a house edge as low as 0.5% with perfect strategy. European roulette has a house edge of 2.7%, while American roulette is higher at 5.26%. Video poker ranges between 0.5% and 5%, depending on strategy. Keno, in contrast, has a much higher house edge, ranging from 20% to 35%.
What strategies can help minimize losses in baccarat?
To minimize losses, players should do the following: 1) Stick to Banker bets due to their low house edge, 2) avoid Tie bets because of their high house edge, 3) manage their bankroll effectively by setting limits, and 4) play at reputable casinos, especially those offering promotions like reduced commissions on Banker bets.