Variance is related to, but different from, the theoretical long-term outcomes of RTP and house edge. Variance applies to the short-term outcome of casino games and it’s what makes them so interesting. For instance, if you decide to wager $100 on black on the single-zero roulette wheel, the outcome could go equally in two ways: you could either win or lose $100. If you place $100 wagers 10 times, the outcome could be a $1,000 win, a $1,000 loss, breaking even, or anything else that applies in between.
There is a significant difference in variance on different games. The variance of table games like baccarat and online blackjack is relatively low, while that of the lottery is huge. The higher the variance of the game you choose to play, the greater your chance of losing your bankroll and the greater the potential of bigger wins. The variance also differs in one game between the different bets. In the case of online roulette, this is betting $100 once or single numbers vs. betting red/black vs. betting $1 a hundred times. In slots, there can be vastly different variance levels in different versions of a single slot game.
This makes your risk tolerance the key determinant in the games you decide to play. In case you are not a big risk taker, you will have less chances of losing all your chips if you play blackjack or bet red/black in roulette. This, however, will also limit your chances of winning. On the other hand, you will have increased chances of going bust if you bet single numbers on a roulette wheel or play slots. You will also have a great opportunity of winning big.