Analysis of Probability and Risk in Baccarat Through Computer Simulation

Abstract

This study aims to analyze the probability and assess the risk of the Baccarat game using simulations in R. The research evaluates the likelihood of winning across different betting options and calculates the expected value for each scenario. By simulating 10,000 rounds for each betting configuration, the results indicate that the probability of winning is consistently lower than the probability of losing in all cases. Furthermore, all betting strategies yield a negative expected value, placing players at a disadvantage in the long term. Betting equally on Player and Banker results in the most negative expected value. Although increasing bets on Tie slightly reduces the negative expectations, it remains an unfavorable strategy in the long run. Additionally, the findings confirm that playing Baccarat as a form of gambling cannot generate sustainable profits, as the probability of going bankrupt is 100%. This is because the likelihood of losing a bet always exceeds the chance of winning. The risk assessment further validates that the rate of capital loss increases exponentially as the number of betting rounds increases.