April 23, 2024

How to manage your betting bankroll better

How would a bankroll help you?

Think of a bankroll as your betting wallet. First and foremost, a bankroll is essential for any bettor, because it helps them manage their finances, in order to not spend more than they can afford to lose. 

Also, having a clear bankroll may prove useful if you want to keep track of your wager amounts over longer periods of time. If you consistently bet a specific amount of money, it is easier to adjust that amount if you have a baseline. What is more, a dedicated bankroll helps bettors detach their gambling funds from their daily expenses, reducing the emotional stress and impulsivity often associated with betting.

A bankroll encourages a long-term view of betting, allowing bettors to ride out short-term losses and focus on profitability. Here are a few tips to manage your bankroll effectively:

Keep a betting record

It would be a good idea to keep a betting journal, so start by documenting the date, type of bet (e.g., sports, casino, poker), and the specific event or game. Record the exact sum of money you wagered, the odds, and the final result (win, loss, or push). 

It’s essential to write down the exact reasons behind each bet and any relevant details, like team/player names or game conditions. Regularly update your record with your latest bets and track your overall profit or loss. If it is easier for you, use a spreadsheet or a dedicated betting app, as these types of apps can offer you insights into your betting patterns and outcomes. By keeping a detailed and well thought-out betting record, you can find trends, change  your strategies, and ultimately make more informed decisions to improve your betting success.

What is the Kelly Principle?

The Kelly Criterion, or the Kelly Principle, is a mathematical formula used by investors and bettors to determine the correct size of a bet or investment in order to maximise long-term profits while minimising the risk of going broke.

Developed by John L. Kelly Jr. in the 1950s, the principle is based on the idea that, when making a series of bets or investments, the goal is not just to win as much as possible but also to manage risk.

The formula takes into account the expected value of a bet (the potential amount you can win or lose) and the probability of success. It suggests that the right bet size should be proportional to the expected return and inversely proportional to the odds. In simpler terms, the Kelly Principle helps you bet more when the odds are in your favor and less when they are not, keeping you on a path to grow your bankroll over the long run.

 

Let’s give an example:

Let’s say you want to bet on a football match. The bookmaker offers odds of 2.5 on Team A winning. You believe that Team A has a 60% chance of winning. 

The Kelly Criterion formula: f* = (bp – q) / b, where “f*” is the fraction of your bankroll to bet, “b” is the net odds given by the bookmaker, “p” is the probability of winning, and “q” is the probability of losing, we can calculate the optimal bet size. In our example: 

Probability of winning, according to you  (p) = 0.60

Probability of losing (q) = 1 – 0.60 = 0.40

Odds  (b) = 2.5

So: f* = (2.5 * 0.60 – 0.40)/2.5

f* = (1.50 – 0.40) / 2.5

f* = 1.10 / 2.5

f* = 0.44

So, according to the Kelly Criterion, you should wager 44% of your current bankroll on this bet. If your bankroll is $100, you should bet no more than $44 on your football match.

Conclusion

All things considered, effective bankroll management is the secret recipe for success. Keep a betting journal to track your performance, learn from your experiences, and exercise discipline. Use the Kelly Principle to help you optimise your bets and minimise risk. For accurate match results and a complete betting experience, Betwinner app download, which provides real-time updates and valuable insights. 

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