It’s been a while since I stepped foot in a casino, but my memories span four continents. My journey through the gambling world started at The Golden Nugget in London – where I managed to get banned. Not for anything glamorous like card counting or hiding a computer in my shoe. No, my crime was abusing the free parking privileges. With central London parking costs as high as they were, most of my bets had positive expected value – an outcome that didn’t win me favour with casino management.
My attempts to beat the house proved equally inept in Cairo, where I came close to blowing myself up with a Martingale strategy at the roulette wheel. After doubling down through six straight losses, the croupier looked at me with genuine concern. “Are you sure you want to proceed?” he asked, his voice carrying the weight of someone who’d watched this story end badly many times before. The ball landed on red. I walked away unscathed, fortunate that my bankroll never had to confront the full fury of geometric progression.
By the time I visited Macau, I had a better grasp of how to play the game. I was among the first visitors through the doors of the Venetian, the largest casino in the world. A close replica of its Las Vegas counterpart – complete with fake sky and gondoliers – its gaming floor stretched over 550,000 square feet, nearly ten football fields of baccarat and slot machines. I spent a few hours at one of its many blackjack tables making some money, though not enough to cover my helicopter fare back to Hong Kong.
I haven’t returned to any of these places since, and it’s been years since I travelled to Las Vegas. It seems I’m not alone. Just 3.1 million people visited Vegas in July, down 12% from a year ago, marking the sixth straight month of declining visitors. Although numbers have risen from the depths of Covid, they haven’t regained their pre-pandemic peak. It’s the same in Macau, which welcomed 35 million tourists in 2024, down from 39 million in 2019.
Last week, one casino stock felt the brunt of this trend. Caesars Entertainment was dropped from the S&P 500 index to be replaced by Robinhood. The committee that oversees the benchmark’s composition doesn’t dwell much on narrative. They look at hard criteria such as market capitalization and profitability and liquidity. On the day they met, Caesar’s market cap was languishing at $5.3 billion; Robinhood’s was close to surpassing $100 billion.
But sometimes there is a symmetry in the handover. We discussed one such case two years ago when traditional insurance company Lincoln National was replaced by Blackstone, whose fresh approach to managing insurance risk is part of a new industry trend. The displacement of Caesars by Robinhood presents an equally compelling story.
To dive deeper into what’s gone wrong at Caesars, what’s going right at Robinhood, and how sustainable those trends are, read on.