Those familiar with gambling know that the house takes a percentage on every card game. The percentage is called house edge and this is how casinos make money on card games. But have you ever wondered how do casinos earn on poker?
If you have ever played poker in a casino or an online site, you already know what a poker rake is. But if you’re just starting out and have a loose understanding of what a rake in poker is, this article is for you.
What is a rake in poker and how does it work? Let’s get down to the basics.
What Is a Poker Rake?
In a poker set up at a land-based casino or an online site, players play poker against each other. Unlike other card games, there is no house edge in poker. Furthermore, the casino is facilitating the game, meaning they have provided all the necessary equipment for the layout. Thus, players have all the conditions needed to make the game possible.
In return, casinos must earn revenue from poker and that is from taking a rake. That’s why casinos collect a commission on the winnings from poker players. It is a way for players to pay a fee to participate in cash games by handing a small portion of the money they have won. That is the rake definition in a nutshell.
In the cardroom, you will notice that the dealer takes chips from the pot and puts them aside. It signifies the rake that is taken after the end of the game or each time a player wins.
Rakes can vary between different land-based and online casinos. At some casinos, there will be pre-set rake that charges all players equally, while in others, only the winner pays the rake.
The revenue that casinos make from taking rakes is also used to pay the staff or cover the operational costs on the E-gaming site. Putting all this into a perspective seems fair enough for casinos to be charging players a small fee for their winnings. But be wary of the fact that some casinos have higher rates than others, especially online casinos since there’s higher competition.
Is it legal for the casino to take rakes?
Many underground poker casinos operate illegally and don’t have a proper gaming license. That’s where concerns arise and hosts can scam players by taking a rake, which is totally illegal. While playing cash home poker is allowed, as per Canadian gambling laws it’s completely illegal to generate revenue from the same.
Therefore, taking a rake is considered a crime if the gambling establishment is not properly licensed and regulated by the provincial authorities.
As long as the gambling provider is licensed and complies with the gambling laws, taking a rake is perfectly legal. Protecting players from scams, in general, is the very reason why the licensing procedure was introduced.
Usual rake percentage
There are several ways for casinos to calculate and establish the rakes. The rake percentage will depend on the casino you choose to play at and the number of players. So what is the average rake?
The rake usually averages between 2.5% and 10%, although, most commonly you’ll find the 5% to be the average rake. But there is also another factor in play that determines the poker rake. If you take part in poker tournaments, the rake can be as high as 15%. Whereas in cash poker, the rake can be fairly lower at only 5%.
Also, keep in mind that rake rates can vary between provinces. Another thing to keep in mind is that online gambling sites tend to have much higher rakes. However, you can always find an online casino that offers lower fees.
What you’ll usually find in the cardroom is that there is a max amount that can be collected for poker rake. While in some instances, there is a fixed rake applying to all players. This means that each player pays an equal fee, regardless if they win or lose. It means that everyone who participates in poker, contributes evenly, regardless of the pot size.
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How is a rake collected?
There are different models of collecting a poker rake. Different gaming establishments may offer different methods. It also depends on the type of players, whether you’re a regular poker player or just a recreational. These variables will set the rake types that will be used in the cardroom.
But the rake types provided below, are the most common ones in land-based and online casinos.
This is the standard method of taking a rake. The rake is determined by the proportion of the pot. Usually, there is a “max” and “up to” limits in pot rake.
When there is a “max rake” it means that the rake is taken regardless of how many players are at the poker table. The “up to” rakes, on the other hand, are related to the number of players. For instance, there is a lower cap (lower rake) if there are fewer players and vice versa.
But casinos may charge different max rakes. For instance, if 5% is the max rake, the house will take $10 from the player’s winnings. When calculating the pot rake, the dealer will determine whether the pot is over the threshold and remove the chips into a drop box.
Additionally, many casinos and poker sites have a no-flop, no-rake policy. This means that there will be no fees if the hand doesn’t go to a flop.
Poker games usually last from 1 to 3 hours, but for some players, even that is not enough. Many poker players dwell in the game so much so that, their perception of time dissolves completely. This very reason initiated the need for cardrooms to limit the players’ time by charging an hourly fee.
Casinos are taking a rake for every hour players spend at the table. But even if you fleet the game earlier, you still will be charged for participating, regardless. Casinos came up with this strategy in hopes that players will want to avoid the higher rakes charges. Thus, they will not take up space for countless hours at the poker table.
Related article: What Was the Longest Poker Game?
In some brick-and-mortar cardrooms you’ll find that they charge a dead drop rake. It means that all players pay the same. There’s an agreed fixed fee before the game begins. The host is taking an equal rake from the players no matter if they win or lose the hand.
Providing that many casinos take a rake only from the winners, many players have started to complain about the unfairness. Many poker players argue the fact that this type of rake depletes their winnings too much and that all participants should share the costs.
This was the very reason why a fixed fee was introduced as a method of taking a rake in more casinos across the globe. Having a fixed fee ensures that the rake is still being taken, regardless of the number of players who lose on cards.
The unfairness of taking a rake in cardrooms was a big concern for high-stack players as well. Providing that they often end up paying big amounts on pots, it’s a relief to know that they don’t have to carry the financial burden of high rakes all by themselves.
Why Should I Care About Rake in Poker?
Rake might not have much meaning for the players who lose. Because every time you lose, all you see is the lost money. You won’t be affected much by what is the rake that the cardrooms take or by how much the winner got. You still lost your bets anyway.
On the other hand, in most situations, the winner is the person who pays the full rake on their own, unless the casino’s rules require otherwise. And we already know the reason behind the rake. Casinos still haven’t found another way to charge for cash live games.
Rakes are not only important for casinos to keep their game going on fully supported with the essential equipment, but it’s very important for players too. Rake can have a significant impact on your bottom line and your ROI (return on investment – rake back).
For instance, if a player has won $200 and paid only $20 in rake, you might think that’s not a big deal. The winner takes more money than he pays in rake right? But over a large sample of hands, the profits can be quite small for the winner in return.
If a player plays multiple tables, means that for every dollar they win on the table per hour, they pay a certain percentage in rake on an hourly basis. If a winner wins a lot of tables, it also means that the hourly fee piles up which would end up in a big cut to their bottom line.
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After you have learned about the rake meaning and how it works, it’s important to search for casinos that charge decent rake. Because the overall rake does impact your winning margins. The higher the rake, the lower the winning profits. Luckily there are many casinos that have a fixed rake and charge evenly to all players at the table regardless if they lose or win.
In poker, cardrooms take a small portion of the winnings from the players. It’s the only way that has been working so far because poker does not have a house edge. That’s why casinos have come up with this method that helps them to earn revenue from live cash games.
The average pot rake is around 5% but can range starting from 2.5% up to 10% or even higher in some scenarios. For instance, in poker tournaments, the poker rake can increase up to 15% or 20%, which is fairly high.
A good rake in poker would be an average of 5% or less. But again, it highly depends on the casino fees, the number of players and the rake types.
If the casino has a valid and proper gaming license, then it’s fully legal to take rakes from players. Taking a rake brings profit to the house and it’s a way to compensate for not having a house edge.
Taking a rake is essentially taking money for letting players wager at the poker table. It’s basically the commission cardrooms take from the player’s profits.
After wondering what is a rake in poker and learning about it, it’s very important to find casinos with the best poker rakes.