As you can see with the above example there is a control and informative post structure to placing the bets and our bets only increase as our bank increases, or our edge increases. Should we hit a losing streak our bets are scaled back – this saves our bank and keeps us in control. Now let’s say we lost that bet so our bank is now down to $80. The coin is about to be flipped again, so we need to stake again.

Betting Apps Comparison

If the favorite wins by 8 or 9 points exactly, you win both your bets. Essentially you are hoping to hit the “middle” of the two wagers. In this example, you make a Odds Probability Calculator point spread bet on a team that’s listed with a spread of -7 in an NFL game in the middle of the week. This process, also known as middling, is when a punter makes an early point spread bet only to see the line move later. Sometimes you’ll also find middling opportunities when you’re line shopping and discover a significantly different point spread for the same game. This strategy is an obvious one but it’s also something a lot of people fail to do because it takes legwork.

History Of The Kelly Criterion

Ultimately, the only realistic way of making money long-term is by finding and betting on overpriced horses. Therefore, a horse at Evens is not worth a bet if it has a 47% chance of winning while a horse at 20/1 is worth backing if it has a 7% chance of victory. This tells me that the correlation inside the array of outcomes has a large bearing on position size.

If you’re making bets that are highly correlated you need to size down, because if one of those bets lose, a lot of those bets might lose. We can see this in March 2020, when all correlations went to one. Crypto crashes went into market crashes, because people sell anything they can in a crash. So if your bets are very correlated you need to size down.

Since people have different opinions, it should be noted that the term expected value is very subjective. Yet, you should always place wagers with a positive expected value. Arbitrage and Surebet Calculator – With the surebet calculator you can check if some bet offer an arbitrage opportunity. Arbitrage betting calculator distributes your capital into individual bets and calculates your profit from surebet while you simply enter odds. What turns out, is that if probabilities are worse than expected, we’re taking considerably more risk by betting too much. That increases our chances of going broke or not earning any positive return.

One very important thing to always have at the back of your mind with this staking strategy is that it is best known for long-term profit maximization in betting and gambling. It’s one of the most cherished staking plans that Pros use in adding value to their bets and ensuring the health of their bankroll. What has been discussed so far is the classic form of Kelly Criterion, otherwise known as a “1x Kelly Criterion”. This is your bread and butter strategy for making money long term with moderate risk exposure. However, if you have a very aggressive appetite for risk, you can try what is known as a “2x Kelly Criterion” whereby your bet sizes are doubled compared with up above.

On the other hand, people can bet money they do not have by borrowing. A person who is allowed to bet more than his wealth might choose to bet more than Kelly while someone who is constrained to bet much less than his wealth is forced to bet less. The biggest diversity of answers came on the third question.

Which is why many people who go broke using Kelly do so because they overestimate their chances to win. Don’t be deluded into thinking because you’ve employed some fancy empirical formula to figure out how much to bet that the most important part of that formula is still likely to fail you. If you knew you would win 100% of your bets, you would be a fool not to bet your entire bankroll on each bet. This would maximize your return and, because you knew 100% of your bets would win, you would have 0% risk of going bust. Let’s check out what the Kelly Criterion does and doesn’t do. It does scale back the prospect that you’re going to lose all your money.