Why Bankroll Management Matters
Even skilled bettors face variance. Without proper bankroll management, a losing streak can wipe out your funds before you have a chance to recover.
Setting Your Bankroll
Your bankroll is the total amount you've set aside exclusively for betting. It should be:
- Money you can afford to lose
- Separate from living expenses
- A fixed amount you don't dip into
Unit Sizing
A "unit" is a standard bet size, typically 1-5% of your bankroll.
Example with $1,000 bankroll:
- 1 unit = $10-$50
- Most bets: 1-2 units
- High confidence bets: 3-5 units maximum
Why Use Units?
- Normalizes bet sizing regardless of bankroll size
- Prevents emotional over-betting after wins
- Limits damage from losing streaks
The Kelly Criterion
The bankroll-management guide is a mathematical formula for optimal bet sizing:
Kelly % = (bp - q) / b
Where:
- b = decimal odds - 1
- p = your estimated probability of winning
- q = 1 - p (probability of losing)
Example:
- Odds: 2.00 (b = 1)
- Your estimated probability: 55% (p = 0.55)
- Kelly % = (1 × 0.55 - 0.45) / 1 = 10%
Fractional Kelly
Full Kelly is aggressive. Most professionals use 1/4 to 1/2 Kelly to reduce variance.
Key Rules
- Never bet more than 5% on a single bet
- Track every bet in a spreadsheet
- Review and adjust periodically
- Don't chase losses with bigger bets
- Withdraw profits regularly to lock in gains
Signs of Poor Bankroll Management
- Betting different amounts based on "feelings"
- Going all-in on "sure things"
- Increasing bets after losses
- No tracking of wins/losses
- Dipping into rent/bill money
Building Long-Term Success
Bankroll management is the foundation of sustainable betting. Combined with edge-finding strategies, proper staking ensures you stay in the game long enough for your edge to materialize.