Kelly Criterion for Beginners

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Kelly Criterion

As a sports bettor looking to take things more seriously, eventually, it’s recommended that you graduate from the unit system.

To do so, you need to understand the Kelly Criterion and how it affects bet staking based on your edge.

The Kelly Criterion is a mathematical formula used to calculate the optimal stake size based on your perceived edge and odds offered by the sportsbook.

While sharp bettors may still flat bet and use units, graduating to Kelly staking, or at least understanding its importance, is necessary for any savvy sports bettor.

The best betting tools do all the Kelly math for you.

Why is the Kelly Criterion so crucial for sports bettors?

Most bettors either bet too much (blowing up their bankroll) or too little (barely moving the needle).

The Kelly Criterion is a simple formula that tells you exactly how much to wager to maximize growth while protecting your roll.

Understanding Kelly Staking

While you don’t need to do the math yourself to Kelly stake (tools can do it for you), it’s still important to know how Kelly staking works.

Here’s the idea in plain English:

• Every bet has two parts:
  1️⃣ Edge → Your true probability vs. the sportsbook’s implied probability
  2️⃣ Odds → What the sportsbook is paying you

• Kelly takes both and spits out the optimal % of bankroll to bet.

Example:

• You think a team has a 55% chance to win.

• Sportsbook odds are +100 (50%).

• Your edge is 5%.

• Kelly says bet 5% of bankroll × edge/odds = ~2.5% of bankroll.

Bet too much → you risk going broke.
Bet too little → you don’t fully capitalize.
Kelly = the balance between growth and safety.

This is Kelly in its simplest form; however, one key point is not to overbet your edge, since, no matter how sharp (or square you are), your edge is still a guess.

So, instead of using full Kelly, most pros use half or quarter Kelly to make sure they are not overbetting their edge.

Fractional Kelly involves betting a fraction of the full Kelly recommendation (such as half or quarter Kelly).

• Reduces volatility and potential losses

• Balances growth and risk effectively

The Kelly Criterion isn’t about “going all-in” — it’s about sizing your bets correctly so one win or loss doesn’t make or break you.

Professional bettors and +EV grinders are volume betting daily.

With live betting also becoming more accessible and more beatable, the betting menu has never been bigger, and edges are being surfaced at an insane rate.

This is why Kelly betting is so essential. With so many good bets to make across the pre-game and live board, by properly staking your bets based on your edge, you should be able to maximize your bankroll for the long haul.

Bankroll management is one of the most important things for any sports bettor, and when you have finally begun calculating edges, either using a tool, the market, or your own numbers, graduating from the unit system is key.

Let’s Get This Straight

Every week, we dissect a relevant sports betting topic to determine its validity.

Trends in Sports Betting

One of the most frequently used talking points in the media for NFL and CFB betting is the concept of trends.

Talking heads love to talk about how the Lions do with a certain moon, how good a QB is on primetime, and how often a team wins or loses against a specific opponent.

Here’s the reality:
Trends are meaningless, especially without context, and they are not something you should blindly bet.

Think about it. Why does a team being 8-1 against their opponent matter when the last seven games between these two teams featured different coaches, quarterbacks, and defensive personnel?

Short answer: It doesn’t.

Situational trends, like how a warm-weather QB performs in the freezing cold, could matter.

But any trend without any situational context, especially with irrelevant factors that do not overlap with anything going on in the current event that’s about to happen, means nothing.

Ignore people who base their opinions, give out picks, or use this as their “edge”.

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Read our full review of Pick The Odds.

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