Kelly criterion, bankroll & staking
How the Kelly criterion sizes bets to your edge, why most bettors use a fractional Kelly multiplier or a flat-stake percentage, and why bankroll management is what keeps an edge alive.
Why staking matters as much as edge
Finding positive EV bets is only half the job. How much you stake on each one decides whether that edge compounds into a profit or gets wiped out by a bad run. Bet too little and you leave money on the table; bet too much and a normal losing streak — which a real edge produces regularly — can bust your bankroll before the math ever pays off. Staking is the bridge between having an edge and keeping it.
The Kelly criterion
The Kelly criterion is a formula that answers one question: given your edge and the odds on offer, what fraction of your bankroll maximises long-run growth? It scales the stake to the size of the edge — bet more when the edge is large, less when it is thin — and mathematically it produces the largest long-run bankroll growth rate in theory while limiting the risk of ruin — assuming your probability estimates are correct. Full Kelly is aggressive, though: it assumes your estimated probabilities are exactly right, and it tolerates stomach-churning swings.
Fractional Kelly and flat staking
Because no fair-value estimate is perfect, most disciplined bettors do not bet full Kelly. They apply a Kelly multiplier — staking some fraction of the Kelly amount, such as half (0.5×) or a quarter (0.25×). Fractional Kelly sacrifices a little theoretical growth for a large reduction in variance and a buffer against any error in your probability estimates, which is usually the right trade.
The simplest alternative is flat staking: risking a fixed percentage of your bankroll — commonly 1% to 3% — on every bet regardless of edge size. Flat staking gives up Kelly's edge-sizing entirely but is easy to follow, hard to get wrong, and forgiving of imprecise probabilities. Many bettors start flat and move toward fractional Kelly as they trust their numbers.
Size to your bankroll, not your confidence
A single bet feeling certain is not a reason to oversize it. Stake as a percentage of your current bankroll so that no normal losing streak can take you out — variance is unavoidable; ruin should not be.
Whichever method you choose, the constant is discipline: a consistent rule, applied to every bet, sized to your bankroll. That is what lets a real edge survive long enough to show up in your results.
- Odds, prices, expected value, conversion rates, and profit figures shown are estimates based on the last data we retrieved. They can change at any time — confirm the current price at the book before you bet, as odds may move and entry errors can occur.