I’ve been writing a series of posts with the theme of “what is gambling.” As part of that series, I’m writing specific posts about selected gambling activities.

And this one answers the question about one of my favorite casino games:

What is baccarat and how does it work?

The simplest way to define baccarat is as a card game where you have 2 or 3 cards. The winning hand is the one with the higher score.
Baccarat is strictly a game of chance; there’s no strategy involved. It’s traditionally a high roller game, although recent versions of the game cater more to gamblers who are playing for lower stakes.

This post includes everything you might ever want to know about the game of baccarat and how to play.

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How to Play Baccarat

Here’s how to play baccarat:

You start by sitting down at the table and buying chips. The card is played from an 8-card deck, and the cards are given point values, just like they are in blackjack. The point values are slightly different though:

The point values are slightly different though:

  • Aces are worth 1 point. (Not 1 or 11.)
  • Numbered cards are worth whatever number they have (2 through 9).
  • Face cards (the jack, queen, and king) are worth 0.

You start by betting on one of 2 hands—player or banker. You also have the option of betting on a tie, but never place this bet. It’s a sucker bet with lousy odds, and I’ll explain that in more detail soon.

Depending on where you play, you might have other side bets to choose from, but it’s best to just skip side bets. They almost always have lousy odds.

Unlike blackjack, where you get a hand that you play against the dealer, there are only 2 hands in baccarat, regardless of how many players are there. In blackjack, each player has a hand to play against the dealer. But in baccarat, there’s just a player hand and a dealer hand.

As in blackjack, though, each hand has 2 cards in it to start.

Each hand is scored with a total of between 0 and 9. You arrive at the point total by adding the points for each card in the hand.

If you have a total of 10+, you just count the points based on what’s after the 1. For example, if you have a total of 14, that’s just a total of 4—you ignore the 1.

In blackjack, you get to choose whether to take additional cards or not. For the player in blackjack, this is a matter of decision-making.

For the dealer in blackjack, it’s a matter of which criteria are present—dealers must always hit a hand with a total of 16 or less, regardless of any other factors.

In baccarat, though, both hands are played based on criteria. The player hand isn’t whim to the decisions of the player at all.

In baccarat, there’s a set of rules that determine whether a 3rd card gets dealt to a hand. A total of 8 or 9 is considered a “natural,” and if either the player OR the banker has a natural, neither hand gets an extra card.

If the player hand totals 6 or 7, the hand stands. If the player hand is a total of 5 or lower, that hand always gets an additional card.

If the player hand stood with a 6 or 7, the banker takes an additional card if the banker total is 5 or lower. If the banker has a 6 or 7, the banker hand stands.

Things start getting more complicated if the player drew a 3rd card.

The banker takes another card based on that hand’s total versus the player hand total, as follows:

  • If the dealer has a 7 or better, the dealer hand stands.
  • If the dealer has a 6, the hand stands unless the player has a 6 or 7, in which case the dealer gets a 3rd card.
  • If the dealer has a 5, the dealer draws with a total of 4, 5, 6, or 7. Otherwise the hand stands.
  • If the dealer has a 4, the dealer draws with a total of 2, 3, 4, 5, 6, or 7. Otherwise the hand stands.
  • If the dealer has a 3, the hand only stands if the player total is 8. Otherwise, the hand draws a 3rd card.
  • If the dealer has a 2, 1, or 0, the hand always gets another card.

This might seem complicated. That’s because it is.

Luckily for the player, it doesn’t matter if you understand what’s happening here or not. The odds are the same regardless, and the player has no meaningful decision to make other than whether to bet on the player hand or the banker hand.

The hand that wins is the one with the higher score. If both hands have the same total, a player bet or a banker bet is considered a push, which is a tie. You get your bet back, but you don’t get any winnings.

If you took the tie bet, you only win if the player and banker hands have the same total.

The player bet pays off at even money. In other words, if you bet $100 on the player and win, you get $100 in winnings.

The banker bet pays off at 19 to 20 odds. In other words, if you bet $100 on the banker and win, you get $95 in winnings. (It’s like paying a 5% commission.)

The tie bet pays off at 8 to 1, which means if you bet $100 on the tie, you’d win $800.

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The House Edge in Baccarat

All casino games have a built-in mathematical advantage for the casino. This is called “the house edge.” It’s the theoretically perfect amount that the casino expects to win in the long run from each of your bets.

If the house edge for a game is 1%, then the casino expects a theoretical win of $1 every time you place a $100 bet.

The casino gets this edge by paying off bets at lower odds than the odds of winning are.

In some casino games, the house edge is the same regardless of which bet you place. In others, the edge varies from bet to bet.

Baccarat is the latter type of game. The house edge for each of the main bets in baccarat is as follows:

The banker takes another card based on that hand’s total versus the player hand total, as follows:

  • The banker bet has a 1.06% house edge.
  • The player bet has a 1.24% house edge.
  • The tie bet has a 14.36% house edge.

The best strategy for most casino games is to take the bet with the lowest house edge. In the case of baccarat, that’s the banker bet. The difference between the banker bet and the player bet is small enough (0.18%) that you could go with the player bet if you find it more entertaining.

But under no circumstances should you ever take the tie bet. That’s one of the worst house edge figures in the casino for a table game.

You can sometimes find a casino which offers a “reduced commission” on the banker bet. Instead of charging a 5% commission, they might charge a 4% or 3% commission—or less.

Any reduction in the commission on this bet results in a lower house edge for the game, which means that the banker bet is even better at such a casino running such a special.

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Baccarat Strategy

Gamblers are always looking for a strategy or a system to help them get an edge over the casino. In some cases, this is possible. Card counting in blackjack is an example.

Baccarat has no opportunity for a winning strategy, though. The house edge for these bets stays the same regardless of any strategy you might try.

With that understood, I’ll look at some of the baccarat strategies that people try and explain the pros and cons of each.

The main strategy most baccarat players use is to track which bets are winning more often—banker or player. This is such a popular strategy that the casino offers pencils and scorecards to the players so that they can track these trends.

How these trends inform a gambler’s betting depends on whether the gambler prefers to try to ride a hot streak or if the gambler thinks that a result has become overdue.

Gamblers who ride hot streaks will see that the banker bet has won 4 times in a row, so they’ll bet on the banker to take advantage of the hot streak.

Gamblers who believe that results become due will bet on the player in that same situation, thinking that it’s unlikely for the banker to win 5 times in a row.

Both these strategies are examples of something called “The Gambler’s Fallacy.” This is the idea that the probability of an event changes based on what happened on previous trials.

But with games like baccarat, every hand is an independent event. The odds don’t change based on what happened on previous hands. The house edge remains the same—it’s still a function of how likely you are to win versus how much you win.

Another baccarat strategy is to raise or lower the size of your bets based on previous losses or wins. The Martingale System is usually considered a strategy for roulette, but some players use it in baccarat, too.

Here’s how the Martingale System works:

You always place the same even money bet. With a win, you celebrate. With a loss, you double the size of your previous bet. If you lose multiple times in a row, you double the size of your previous bets in a progression.

For example, if you bet $100 on your 1st bet, and lose, you’ll bet $200 on your 2nd bet. If you lose again, you’ll bet $400 on your 3rd bet.

After each progression, when you eventually have a win, you’ll recoup your losses from the previous bets and come out ahead by one unit.

This sounds great in theory, but it assumes that long losing streaks are less probable than they actually are. What The Martingale System does is improve your probability of having a small winning session, but you’ll also face occasional large losing sessions that make up for your losing session.

That’s because you’ll always eventually either run into the top of the betting limits for the casino or the top of the betting limits that your bankroll can handle.
Let’s say you sit down with $5000.

If you start with a bet of $100, you’ll hit a $5000 loss faster than you think:

  • 1. $100
  • 2. $200
  • 3. $400
  • 4. $800
  • 5. $1600
  • 6. $3200
  • 7. $6400

If you lose 5 times in a row, you’ll have lost $3100, so you won’t even have enough money to place the next bet. (You started with $5000, so you only have $1900 left.)

Most casinos also have maximum betting limits. They vary, but there’s usually not a huge betting spread possible.

Some players wonder if they could get an edge at baccarat by counting cards, just like blackjack players get an edge. This is theoretically possible, but a deck with a positive expectation would only come up rarely—too rarely to be practical.

Also, the kind of edge you could gain in baccarat would be too small to have a practical effect on the amount you were able to win.

One strategy that can work with baccarat is edge sorting, but it’s considered cheating. With some decks of cards, you can tell one card from another by looking at its edge because of imperfections in the printing process.

If you can convince the dealer to rotate some cards one direction instead of another, you can theoretically predict which cards will be high and which ones low.

Poker player Phil Ivey used this technique to win a fortune in the United Kingdom, but the casino said he was cheating. The courts upheld this decision, so Ivey didn’t get his winnings. Edge sorting requires more effort than most gamblers I know are willing to make.

I’m not sure it would be worth the effort if the casino were to also just void your winnings because you were cheating.

You can find other, easier, more reliable ways to get an edge when gambling. Learn to play poker well, or become a sports betting expert.

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Different Baccarat Variations and What Distinguishes One Baccarat Game from Another

Punto Banco

Baccarat is also called “punto banco.” This is the traditional, high roller version of the game. You play at a big table in a special, roped-off part of the casino. Punto banco is kept separate from the other casino games, usually.

You’ll find high rollers—especially Asians—wagering thousands or more per hand. The minimum bets in these games usually start at around $100, although some casinos have minimum bets of $500. You can often negotiate a maximum bet with the casino in these rooms.

In the traditional version of baccarat, or punto banco, the croupier directs the gameplay. She’s assisted by 2 baccarat dealers who handle the bets and payouts.

These games usually use 8 decks, but sometimes they only use 6 decks. There’s not a big difference in the house edge between a 6-deck and an 8-deck game.

Mini-Baccarat

Lower stakes players often play mini-baccarat, which is just a smaller scale version of the same game. The biggest difference is in terms of stakes. The minimum bets are lower at a mini-baccarate game. The table is smaller and accommodates fewer players, too.

The rules are the same, too, and there’s no real difference in terms of the math behind the game and who has an edge or how much of an edge.

Chemin de Fer

Chemin de fer is an older variation of baccarat which is mean to be faster than the original game. The name is French for “railway,” which used to be the fastest way to travel.

Chemin de fer uses only 6 decks, and a player takes the role of banker and deals. The other players are the punters. The banker position rotates counterclockwise around the table.

During a round of Chemin de fer, the banker decides how much she wants to risk. Then the players get to match that wager or bet something smaller. If the total wagers from the punters amount to more than the banker was willing to bank, the banker has the opportunity to increase that amount.

Any wagers over the amount of the bank are removed from play in reverse order.

Gameplay is similar to that of traditional baccarat. The player hand and the banker hands start with 2 cards and follow the same hitting and standing rules as in regular baccarat, with this exception:

The player gets to decide how to play the hand.

Since multiple players are betting on the player hand, the player with the highest wager gets to make the decision about whether to take the 3rd card. Peer pressures usually prevents a player from making a mathematically unsound decision here, too.

The banker also gets to make her decisions.

The traditional way to play is simple enough, too. If you have a total of between 0 and 4, you always take a 3rd card. If you have a 6 or 7, you always stand.

If the banker wins, she gets to remain banker. Otherwise, the banker position rotates. In the case of a tie, all the wagers stay in action and a new hand is played.
Any time a banker wants to drop out, she can. A new player willing to match the bank gets to take over.

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Baccarat and James Bond

If you’ve never seen a James Bond movie older than Casino Royale, you might not realize that Bond’s game of choice isn’t Texas holdem. It’s baccarat.

More specifically, Bond plays Chemin de fer, not punto banco. He plays the game in the novel Casino Royale, which is mostly about Bond playing baccarat with Le Chiffre. The game was changed for the most recent adaptation of Casino Royale because of the popularity of Texas holdem at the time.

Bond also plays baccarat in the following movies:

If you start with a bet of $100, you’ll hit a $5000 loss faster than you think:

  • Dr. No
  • Thunderball
  • On Her Majesty’s Secret Service
  • For Your Eyes Only
  • GoldenEye

James Bond and baccarat go together like peanut butter and jelly.

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Conclusion

It’s hard to find a better casino table game than baccarat, especially if you don’t want to be saddled with the pressure of making decisions that will affect the math behind your play.

Once you understand that the banker bet is the bet with the best odds at the table, you can just place that bet repeatedly and feel confident that you’re following the best possible strategy.

Even if you ignore that and take the player bet some of the time—maybe on a hunch—you’ll still be doing all right. The only thing you MUST do to avoid being an idiot at baccarat is to refrain from taking the tie bet, which is awful.

Other side bets might be available, but you should decline them, too.

Baccarat is basically an elaborate card game version of flipping a coin. It just involves a lot of ritual and rigmarole.

Do you like to play baccarat, and if so, which version is your favorite and why?

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