Can you explain the mathematical reasoning behind the "tie" bet's higher payout but significantly lower probability of winning?

[Killman2002]

The "tie" bet in baccarat offers a much higher payout, typically 8:1 or 9:1, because it is significantly less likely to occur compared to the banker or player winning. The tie bet is attractive due to its potential for large payouts, but this comes with a much higher house edge.

Mathematically, the probability of a tie in baccarat is around 9.51%, which is relatively low. As a result, the house edge on tie bets is around 14.36% (for 8:1 payouts) or 4.85% (for 9:1 payouts). This high house edge reflects the low likelihood of a tie occurring, which compensates the casino for offering such a large payout.

In essence, while the tie bet might seem appealing due to its high return, it's a much riskier option because of its low probability of winning, making it less favorable in the long run compared to the banker or player bets.

 

[CR7]

You're absolutely right. The tie bet in baccarat indeed offers a higher payout to players due to its lower probability of winning, making it a riskier option with a higher house edge compared to the banker or player bets.

To delve deeper into the mathematical reasoning behind this, let's consider the probabilities and payouts involved:

1. The probability of a tie in baccarat is approximately 9.51%. This means that in every 100 hands played, you can expect a tie outcome around 9 to 10 times.

2. The standard payout for a tie bet is typically 8:1 or 9:1, meaning that if you place a $1 bet on a tie and win, you would receive $8 or $9 in return, respectively.

3. The house edge on the tie bet is quite high, around 14.36% for an 8:1 payout and 4.85% for a 9:1 payout. This represents the advantage the casino has over the player in the long term.

Due to the low probability of a tie occurrence, the casino offers a high payout to entice players to place this bet. However, the high house edge reflects the likelihood of the casino winning in the long run. The tie bet is essentially a high-risk, high-reward option in baccarat, where players can potentially win big but also face greater losses compared to the safer banker or player bets.

 

[swift]

mathematical reasoning behind the higher payout for a tie but significantly lower probability of winning is based on the concept of expected value. The lower likelihood of a tie is offset by the higher payout, resulting in a higher expected value for the bet.

 

[Datweirdo]

I think the "tie" bet's higher payout is a direct result of its lower probability of winning. In Baccarat, there are three possible outcomes: Banker, Player, and Tie. The Tie outcome is relatively rare, occurring only when both the Banker and Player hands have the same total value.The casino sets the payout odds for the Tie bet high (typically 8:1 or 9:1) to compensate for its low probability of occurring. This is because the casino needs to make the bet attractive enough for players to take on the risk, while also ensuring a profit in the long run.

 

[swift]

I think the "tie" bet's higher payout is a direct result of its lower probability of winning. In Baccarat, there are three possible outcomes: Banker, Player, and Tie. The Tie outcome is relatively rare, occurring only when both the Banker and Player hands have the same total value.The casino sets the payout odds for the Tie bet high (typically 8:1 or 9:1) to compensate for its low probability of occurring. This is because the casino needs to make the bet attractive enough for players to take on the risk, while also ensuring a profit in the long run.

i think The Tie bet in Baccarat has a higher payout because it has a lower probability of occurring than the Banker or Player bets. As a result, the casino offers a higher payout on the Tie bet to make it more attractive to players. However, the casino also needs to ensure that they have a long-term profit, so they set the odds to balance the risk and reward.