Win rate, Standard Deviation, Bankroll, and Kelly's Criterion

[quantumleap]

I would like to address the issue of variable bet size and win percentage. I have heard quite a few posters talk about "if you can win 58% or 60% you can be rich". Then we have ice man's excellent post about someone hitting 55% and only making a 5k profit. But how many of us bet the same amounts for each bet?

CoachLT and Insiders both made good points about how when a person first starts out they should bet roughly the same amount per bet. Then, when they have a good feel of the particular sport they can vary bets.

Let's say someone like CoachLT gets pretty damn good in a particular sport (or even a particular betting segment in that sport). That person has a good idea of how well they know certain aspects whether it be a particular team or perhaps totals or perhaps 2nd halfs. That person can vary their bets successfully.

Let me use particular percentages here. Let's say CoachLT wins 45% of most of his bets that he bets outside of college football. Yet in college football he is winning 60% and his bets are increased. Overall the number of bets he wins may even be below 50% yet the actual amount he wins is for a good profit since he is winning a good majority of the larger bets.

In summary, only when a person bets the same amount on each game can the percentage of games won really come into play. Otherwise, if you are betting varying amounts on games you know really well you can still make a profit.

 

[Woody0]

I would like to address the issue of variable bet size and win percentage.

Well we get back to Kelly again. To maximize bankroll growth you should bet that fraction of bankroll that equals your advantage. (In blackjack you rarely get above a 2-3% advantage). In sports your advantage cannot be precisely calculated mathematically, as it can for blackjack in real time sitting at the table. I suspect that players who wager large fractions of bankroll (say 10%) successfully, have a good sense of what their mathematical advantage might be.

I largely follow several cappers here at the Rx and am most comfortable playing less than 1% on most of my bets (my bankroll is low-mid 5 figures) as I view it as a profitable entertainment and am paranoid about bankroll preservation since it cannot be replenished. However I have placed bets in the 4-5% range on a progression system I am following.

In summary it makes sense to vary your bets in relationship to your perceived advantage if you can successfully discriminate between moderate and large advantages.

 

[quantumleap]

(In blackjack you rarely get above a 2-3% advantage).

Correct me if I'm wrong when I say that a typical person imagines a professional blackjack player playing at $10-$20 a hand until they get an advantage and then upping the bet amounts to $100+ per hand. This is simply not the case.

 

[Woody0]

Correct me if I'm wrong when I say that a typical person imagines a professional blackjack player playing at $10-$20 a hand until they get an advantage and then upping the bet amounts to $100+ per hand. This is simply not the case.

A 5-1 spread provided you don't wear out your welcome is reasonable. A good double deck game is -0.25% of the top so a pro might play $100 and increase if warranted as (s)he gets an advantage going to $200 then $400 by pressing bets. One can also take advantage of playing multiple spots if you are alone or there are few players.

Sadly the good games are mostly gone.

 

[Fishhead]

Bumping this thread in hopes that it will help a few sportsbettors this season as we enter the 2006 football campaign.

 

[LogansRun]

For those who know the theory and practice of Kelly betting, what are the fallacies in the "Debunking the Kelly Criterion" by Miller? I read others call the article crap but it's never spelled out explicitly where the inconsistencies are.

http://www.professionalgambler.com/debunking.html


btw this is a thread that should be read by pretty much everyone.

 

[MrJ]

JR Miller? Run. Run hard.

 

[winbet]

Lots of over analysing, keep it simple. Make sure you have more on the Winners and less on the Losers. :drink:

 

[roach23]

You betcha there are!!!

Some of which have never produced a losing record in any year for 20+ years.

When you find one, suggest you do not tell ANYBODY.

Fish, how about dropping one of your secrets for your RX buddies since its your last day?

 

[bakinbaconwithMacon]

I have a question for the pros out there. If some of you are profitable sports bettors then wouldn't the books look down on you and want to close your account knowing you are making money off of them? I guess this is where you do price shopping and spread your bets around. My guess is that if you are making less than 10k / year over 1000+ plays then you don't show up on the radar screen unless you start betting larger amounts.

Thanks and great thread.

 

[Iceman]

I have a question for the pros out there. If some of you are profitable sports bettors then wouldn't the books look down on you and want to close your account knowing you are making money off of them? I guess this is where you do price shopping and spread your bets around. My guess is that if you are making less than 10k / year over 1000+ plays then you don't show up on the radar screen unless you start betting larger amounts.

Thanks and great thread.

wouldnt say I am a pro but I have made quite a bit the past 6 months. I rotate my money at 12 books or so anymore, keeping 6 funded at all times. I bet very small and try and spread it around everyday. Beleieve it or not I actually like and hope I lose at some, it that makes any sense.

I have NEVER been booted at any book. Like you said in a perfect world beating each book for under 10k is ideal. I am still not up over 8k at any book but I think I am up over 3k at 7 books or so.

 

[RobFunk]

:aktion033

 

[Fishhead]

Bump for Mr. Jefferson

On this subject, I recommend everyone on this forum read the book Fortune's Formula.

Outstanding book detailing many of the facets of this subject since its inception.

I'm currently in the process of reading it for the 2nd time.

 

[vyomguy]

good info