This game is a variation of poker played on a blackjack sized table. Following is how the game is played:
Strategy The player should raise on any pair or better, fold on anything less than ace/king, and should sometimes raise and sometimes fold on ace/king. To play Caribbean stud perfectly would involve memorizing the charts in my appendix on when exactly to raise on ace/king. Of course nobody is going to do that so a more simplified strategy is clearly called for. By studying the appendix you will notice certain patterns of when the odds favor raising and when they don't. I have summarized these patterns in the following suggested rules of thumb on when to raise on ace/king:
- Raise if the dealer's card is a 2 through queen and matches one of yours.
- Raise if the dealer's card is an ace or king and you have a queen or jack in your hand.
- Raise if the dealer's rank does not match any of yours and you have a queen in your hand and the dealer's card is less than your fourth highest card.
This strategy is unique to this page but is not the only strategy I have heard of. Following are various other strategies, their total loss based on all possible 19,933,230,517,200 combinations of hands, the house edge, and the "element of risk" (defined below).
House Edge, Element of Risk
Any respectable book will tell you that the house edge in Caribbean stud poker is about 5.2%. This is true but I have always felt it unfairly makes the game look like a bad bet. The reason is in how the house edge is defined, the ratio of average money lost to the original bet. In Caribbean stud the player will roughly wager just as much in raises as in antes, and this additional money bet is not considered in the house edge statistic.
For purposes of comparison to other games I think it is better to consider the ratio of money lost to total money wagered, which I refer to as the "element of risk." The element of risk using perfect strategy is 2.555%, which makes is look more competitive compared to other games, although still not one of the best. It is interesting to note that the element of risk for my three rules of thumb is better than for perfect strategy! That is because raising on slightly suboptimal plays is actually a better bet than the game as a whole and brings down the average expected loss.
Credit should be given to Stanley Ko, Professor John M. Gwynn Jr, and the late Peter Griffin for being the first to do a thorough study of Caribbean stud poker. Due largely on the complexities of when to raise on ace/king this is one of the most complicated casino games to analyze. Thanks to their analysis, which they kindly shared with me, I had something to check my work against.
Progressive Jackpot Side Bet
In Caribbean Stud Poker the player has the choice to make a side bet of $1 which pays for hands of a flush or better. The specific payoff tables vary from place to place but always feature a progressive jackpot for a royal flush. While the expected return varies depending on the size of the jackpot it is a sucker bet the vast majority of time. The average house edge is 26.46%.
A manager at Casino Niagara kindly explained how the jackpot meter works. For every dollar bet 71 cents goes into the jackpot and the casino keeps the other 29 cents. This rate of contribution can vary from place to place. All payoffs are paid right out of the meter. Every time somebody hits a royal flush the house contributes $10,000 (called the seed) to the next jackpot. The house edge is just under the cut per bet because the casino puts up the initial seed to start a new jackpot after somebody wins the previous one. At the Casino Niagara the house can expect to receive 18.84 times as much money from the 29% cut as it pays to seed new jackpots.
The house edge will depend directly on the progressive meter at any given moment. However over the long haul the casino will enjoy a healthy house edge from the Caribbean Stud side bet. It is typical for the casino to put about 70% to 75% of money bet in the jackpot meter and hold onto the rest. Every casino I have asked recedes the jackpot meter with $10,000 after somebody hits a royal which will cost 1.539% of money bet. So the house edge will be 1.539% less than whatever cut it keeps for every dollar bet. At the Casino Niagara for example where they keep 29% the house edge will be 27.461%.
