The calculation of the stake with the Kelly formula can be realized here.
The Kelly strategy is based on a formula that allows the identification of long-term profitable bets (value bets) and the calculation of the stake for them. The stake will be a certain percentage of the bankroll, percentage that will be higher or lower depending on the chance of winning estimated by the bettors in relation to the odds of the bet offered by the bookmakers.
In order for the bet to be considered profitable in the long term, the odds of the bet offered by the bookmakers must be higher than the odds corresponding to the chance of winning estimated to the respective bet by the bettor.
The formula is:
f = (bp – q) /b
- f - the percentage of the bank to roll which have to be staked
- p - the probability of winning
- q - the probability of losing
- b - odds
Advantages / Disadvantages
- It is very useful for bettors able to estimate the real probability of winning the bets but it causes losses to those who superficially estimate the probability and who only consider that they are doing it well.
Anticipating the real probability of winning a prognosis is achieved through a complex analysis that besides statistics includes many other aspects, such as: the advantage of one's own field, how well a team plays at home or away, the direct results, the moment form, the importance of the match and the motivation of the teams, the state of the weather, the unavailable players, the internal problems of the teams, and so on. Each aspect counts more or less depending on the event, and how much importance is given to a particular aspect depends on the betters.
The strategy settings are shown in the image below and described under it:
Where we have like this:
- Probability of winning estimated by bettors;
- The bankroll value from which will be established the percentage of the stake calculated with Kelly formula;
- The odds offered to the bet by bookmakers;
- The maximum stake that can be obtained with the Kelly formula as a percentage of the bankroll. Considering that the estimates are approximately correct, then the amount bet according to Kelly's criterion should not exceed 20% of the bank's total. However, if such stakes are reached, it is advisable that for the safety of the bank to bet a lower amount. We can choose the stake calculated to be:
- Three quarters,
- A quarter,
- Decreasing (>10%) - so that the stake gradually decrease when it is greater than 10% of the bankroll value. The stake will become three quarters when it is between 10%-20%, half when it is between 20%-30% and a quarter when it is over 30%.
- Decreasing (>20%) - so that the stake gradually decrease when it is greater than 20% of the bankroll value. The stake will become three quarters when it is between 20%-30%, half when it is between 30%-40% and a quarter when it is over 40%.
- The button to get the stake calculated with Kelly formula according to the settings.
3. Information obtained
The information obtained is presented in the image below and described under it:
Where we have like this:
- Stake calculated with the Kelly formula;
- The odds corresponding to the probability of winning estimated to prognostic by the bettor;
- Possibility to add the bet to the Monte Carlo simulation method (available to logged in users).
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