There's no single "correct" way to manage a betting bankroll. Professional bettors use different models depending on their edge, risk tolerance, and betting style. Here are the main approaches and when each one makes sense.
Flat betting means every bet is the same size—usually 1-3% of your total bankroll. You don't adjust based on confidence, odds, or how strong you think the play is. Every bet gets the same amount.
Simple to implement. No need to estimate your edge on individual bets. Prevents overbetting on plays you're overconfident about. Works well for bettors who aren't good at distinguishing between strong plays and weak plays.
Leaves profit on the table when you have genuinely strong edges. Treats all bets equally even when some clearly have more value than others.
Beginners, recreational bettors, and anyone without a proven track record of identifying edges accurately.
Kelly adjusts bet size based on your estimated edge and the odds. The bigger your edge, the more you bet. The smaller your edge, the less you bet. It maximizes long-term growth if your edge estimates are accurate.
Mathematically optimal for long-term growth. Automatically scales bet size to match edge size. Tells you when not to bet (negative Kelly).
Requires accurate edge estimation, which most bettors are terrible at. Full Kelly creates massive volatility. Easy to overbet if you overestimate your edge.
Experienced bettors with proven ability to beat closing lines. Use fractional Kelly (half or quarter) to reduce risk.
Some bettors use a tiered system: 1 unit on standard plays, 2 units on strong plays, 3 units on best bets. This is simpler than Kelly but allows some variation based on edge.
More flexible than flat betting. Easier to implement than Kelly. Lets you bet more on your best plays.
Confidence doesn't always equal edge. Most bettors overestimate their edge on "best bet" plays and end up overbetting.
Intermediate bettors who have some ability to identify stronger plays but don't want the complexity of Kelly.
Some bettors set a profit target (e.g., win $100 per game) and adjust their bet size based on the odds to hit that target. Betting a favorite at -200 requires a $200 bet to win $100. Betting an underdog at +150 requires a $67 bet.
This model bets more on favorites and less on underdogs, which is backwards. Favorites are typically more efficiently priced, so betting more on them reduces your edge.
Professional bettors avoid this model entirely.
Most modern professional bettors use some version of percentage-of-bankroll betting, whether flat or variable. The key principles:
- Recalculate bankroll regularly (weekly or biweekly)
- Never bet more than 5% on any single game
- Use fractional Kelly if varying bet size
- Track closing line value to verify edge