Insight
AUSTRALIA Gaming Legend - John Willis
John Willis, In 2007, John Willis was the Senior Product Manager, Aristocrat Leisure Limited, and had been a gaming consultant for over 25 years when he wrote a series of standout articles for G3 magazine. John had an incredible and extensive knowledge of the gaming industry, he was passionate about improving the market and moving it forward. John died on March 3, 2017 and will be remembered by all at G3 as a gaming legend.
G3 guide to gaming: what does volatility mean to you?
Te concept of volatility in the gaming world is often misunderstood. After all, there are statistics to grapple with, and users see volatility from different points of view...
To game designers, volatility is ‘the inherent distribution of wins around the expected average return’, i.e. volatility is driven by the size of wins multiplied by the expected winning hit frequency, which results in the percentage of payouts of those wins.
To operators, volatility impacts as a variation in cash box clearances independent of actual game turnover (i.e. less than expected hold %). When the hold is down, the hand pays are up.
To players, the duration of play varies to achieve a significant win. Volatile games generally have higher hit rates of 1 in 20 or more, and have more frequent significant wins.
Now for the statistics. Volatility of an individual game is calculated by the standard deviation (SD) around expected player returns (PR). Tis is determined on the results of at least 100,000 games at a 95% confidence interval.
Te volatility formulae are: Volatility range (game) equals: 1.96 x √∑ SD Prizes – (RTP)2 √Stroke
SD (individual prizes) is equal to: Prize2 x Hits Cycle
Let’s look at how this works out for a very successful 9-line 90-credit game where the free game feature was triggered from a scatter win:
P32 NEWSWIRE / INTERACTIVE /
247.COM
Game cycle size . . . . . . . . . . . . . . . . . . .140,958,720 Hold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12.40% Total winning hits . . . . . . . . . . . . . . . .10,053,845.35
In this game, there are 15 separate prize levels ranging from 2 to 2,500 credits. Some standard deviation calculations are as follows.
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Te 2,500 credit prize has 1,967.473 hits. Using the formula above, the result is a standard deviation for this prize of 87.236.
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Te 2 credit prize has 3,805,670.162 hits, which results in a standard deviation of 0.108.
Te sum of all the individual prize standard deviations is 181.353.
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Te overall game standard deviation is 13.44 (calculated by using the above-the-line component of the volatility range formula).
Applying the volatility range formula to 100,000 games, the result is a range of plus or minus 8.33% with 95% confidence (2 standard deviations).
Te following table shows the range of percentages across the number of games played:
Games
100,000 200,000 500,000 1,000,000
Range % Max +/-8.33 +/-5.89 +/-3.72 +/-2.63
20.73 18.29 16.13 15.03
Min 4.07 6.51 8.68 9.77
Tis means that over 1,000,000 games played, the hold percentage range of this game will be
G3 & JOHN WILLIS Looking back at copies of G3 from 2007 - the period in which John Willis was writing for the magazine - his contributions remain one of the best read and most useful we’ve ever published. John’s clear explanation of often wildly complicated processes and his passion for the subject, combined with the cartoons drawn expecially for the column by The Times cartoonist, Jonathan Pugh, was a heaven- made match. G3 met John only once, at a fairly pointless conference on the shores of beautiful Lake Como in Italy. People use the term “scholar and a gentleman,” a little too freely, but in John’s case, it was true. Here we re-print one of John’s most memorable articles from G3 October 2007. We apologise for none of the complicated maths.
12.40% plus or minus 2.63% (i.e. between 15.03% and 9.77%). Remember, though, that 1 in 20 games do operate outside this range.
Te more volatile the game, the more variation there is compared to expected returns. Te greater the number of strokes, the more consistent is the profit returned to the venue. For the player, though, the gaming remains just as volatile. Te variation can be significant day to day, and this is what contributes to the player’s experience.
Don’t make the mistake of thinking that the longer the game is on the floor, and the more games that are played, the game volatility range will reduce for the player. Tis range reduces only in the venue’s records – the game on the floor is just as volatile day to day even if 100 million games have been played.
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