Betting can be fun, and profitable. However, it is important to realise that there is also risk involved. Gambling can have serious real world consequences so it is important to set out with a plan and manage your money effectively as you go. In this article we’ll start with some basic rules and ideas to help you do this, before moving on to more advanced strategies which are usually the preserve of professional gamblers.
How much should I start betting with?
When choosing how much to start betting with (what is known as your “bankroll”) a good rule of thumb is to ask yourself. “Would my life be seriously affected if I lost all of this money?” Do not use savings that have a defined purpose or money that a partner or family member would be upset about losing.
This figure for you might be £1000 per month or it might be £100 or it might be £10. Everything is relative and you should pick an amount that is appropriate for your income and responsibilities. As well as starting out with this figure in mind you could set deposit limits with bookmakers to ensure you do not exceed this amount.
Don’t chase losses
Don’t chase losses is the oldest rule in gambling but it bears repeating here. The whole point of starting out with a bankroll that you can afford to lose is that you should try not to lose it (and we’ll do our best to give you winning strategies) but that if you do lose it it doesn’t matter in the grand scheme of things. This is true as long as you don’t exceed it and put more money in. Once your bankroll is gone you should wait until you have sufficient funds to create a new one that still meets all the conditions we outlined at the start.
Not only will this mean that your relationships and assets will be protected, but if you take the limits of your bankroll seriously it should also make you a better bettor who thinks carefully about each and every bet.
Be organised and track your bankroll
Keeping track and managing your bankroll is crucial, especially in the modern world of online bookmakers where your bets could be spread across loads of different websites. You can track all your bets through KickOff by signing up, and we’ll automatically provide you with your full betting history at the click of a button. This will be useful for implementing some of the bankroll management strategies, as well as improving your betting by looking at what went well and what didn’t.
Basic strategies for deciding how much to bet
There are several different options when deciding how much to stake each time. They all have pros and cons so we’ll take a look at them in more detail. The crucial thing to remember though, is that while it might be tempting to put down larger stakes in search of a big win, this can quickly leave you with no more money to bet.
Level staking, sometimes also called flat betting, is quite simple. It involves betting a standard amount, regardless of the odds of your bet.
There are two versions of level staking. You can either bet a fixed percentage of your starting bankroll or a fixed percentage of your bankroll as it stands.
Betting a fixed percentage of your starting bankroll can lead to losses mounting more quickly if you start with a losing streak. However, it also gives you the opportunity to recover more quickly. Betting a fixed percentage of your current bankroll can quickly become quite conservative with small stakes making it difficult to recover back to your starting position. Let’s look at it in a bit more detail.
Fixed Percentage of Starting Bankroll
First, we’ll look at betting a fixed percentage of your starting bankroll.
Let’s say your starting bankroll was £100, you could divide it into 100 units of £1 meaning each unit bet would be 1% of your starting bankroll. Professional gamblers recommend 1%, 2% or at an absolute maximum 5% of your bankroll per stake. If you staked a flat 5% of your starting bank roll every time, it would only take 20 straight losing bets to completely exhaust your bankroll. This sort of run of bad luck can easily happen, even to good bettors.
The advantage of level staking is that it’s easy to calculate your stake every time - it’s exactly the same each bet. The cons are that, as we’ve seen, your bankroll can disappear in a hurry with this strategy and it also doesn’t take into account the odds on the bet you’re making - some bettors argue it doesn’t make sense to put the same bet on a short priced favourite as a long shot, and we’ll come onto these ideas in the advanced bankroll management section.
Fixed percentage of current bankroll
If you bet a percentage of your bankroll each time, then this can limit losses on a losing streak. For example, if you bet 5% of your starting bankroll of £100 on the first bet, that would be a stake of £5. If that bet lost the next stake would be 5% of £95 (£4.75). If you lost 20 times in a row using this staking system you would still have £35.80 of your bankroll left and your next stake would be £1.79.
This is a big plus for this system. However, clearly with a stake of just £1.79 it would take a long time to recover your original bankroll.
Progressive staking is similar to level staking except instead of keeping the percentage the same, you increase it after a winning streak and decrease it after a losing streak. It could be either a percentage of your starting bank roll or a percentage of your current bankroll. For example, you might start betting with 1% of your starting bankroll and then increase it to 2% after 5 straight winning bets.
Advanced Bankroll Management Strategies
These next strategies are much more advanced, and are not recommended for beginners.
The Kelly Criterion
A much more advanced method is the Kelly Criterion, and this is particularly for those of you pursuing a value betting strategy. The idea is that your stake should be related to how much value you think there is in the bet, to mitigate risk and maximise profit. The formula for the Kelly criterion is shown below - don’t worry, we’ll walk you through how it actually works!
f*= ((p(b+1)) – 1)/b
● f*is the fraction of your bankroll you should bet
● b is the net odds you can get for your wager, expressed in decimals (essentially, this is without the return of your stake so if the odds are 1.5, the net odds are 0.5, if the odds are 1/1, then b is 1)
● p is the probability of winning (this is your estimate, not what the bookies suggest the probability is)
Let’s say the bookies are offering odds of 3.0 (2/1) on Arsenal to win. This means b = 2.
You think the probability of Arsenal winning is actually 50%. P = 50%.
When you put this into the formula this is what you get:
f* = ((0.50(2+1)) – 1)/2 = 0.25 In this example, you should bet 25% of your bankroll.
If f* comes out as a negative number, you should not bet. This means that your prediction of the probability of Arsenal winning is actually lower than that of the bookies, and this isn’t a value bet.
You can modify the Kelly criterion in several ways to either be more aggressive or conservative with your bankroll management strategy.
The Full Kelly
This is the method we’ve just worked through. The maximum this version of the method can recommend you bet is 50%, which means theoretically you could have just 25% of your bankroll left after two failed bets. As a result of this, there are versions of the Kelly which are less aggressive and recommended for bettors experimenting with this strategy.
The Fractional Kelly, Half Kelly or Quarter Kelly
Basically, this method involves doing the Full Kelly criterion calculation and then staking a consistent fraction of that amount (it could be 50% or 33% or any number you like really). You will risk less of your bank roll, however your potential profits are obviously also lowered. You could combine this with progressive staking, to start for example with a Quarter Kelly and move up to a Half Kelly after a period of success.
Right, you’re up to date on bankroll management strategies are you’re ready to place your first bet. Check out our latest market predictions to build your own bet, or take a look at some of the tips from our top tipsters.
If you want to read more on betting strategies, try our betting strategies 101 or advanced betting strategies.