The Kelly Criterion: How Much Should You Actually Bet?

Finding a +EV bet is only half the job. The other half is how much to stake. Bet too much and variance can wipe you out even with a real edge; bet too little and you leave growth on the table. The Kelly Criterion is the maths that finds the sweet spot.

The Kelly formula

For a bet at decimal odds o with a true win probability p, the optimal fraction of your bankroll to stake is:

f = (o × p − 1) / (o − 1)

If the result is zero or negative, you have no edge and shouldn't bet. Multiply f by your bankroll to get the stake. Our free Kelly Criterion calculator does it for you and shows full, half and quarter Kelly side by side.

A worked example

Say you can back a team at 2.10, and your fair estimate says they win 52% of the time. Then f = (2.10 × 0.52 − 1) / (2.10 − 1) = 0.092 — full Kelly says stake 9.2% of your bankroll. On a €1,000 bankroll that's €92.

Why almost everyone uses fractional Kelly

Full Kelly maximises long-run growth, but it is brutally volatile and unforgiving if your probability estimate is even slightly off — and it always is. Most serious bettors stake half or quarter Kelly, which keeps the large majority of the growth with far smaller drawdowns. If in doubt, bet less.

Kelly is only as good as your probability

The formula needs a p — your estimate of the true win probability. The best source for most bettors is the no-vig fair odds of a sharp bookmaker: devig the market, convert the fair odds to a probability, and use that. Garbage in, garbage out — a great staking plan on a bad estimate still loses.

The bottom line

Kelly turns your edge into a stake size in one number. Use fractional Kelly, base it on a devigged probability, and track your results. Sizing your bets with discipline is what separates a bettor with an edge from a bettor who blows up.