Kelly

What is the Kelly formula?

The Kelly formula uses your own estimate of how likely an outcome is, the odds and the size of the bankroll to work out how much you should stake. If you fill in the odds, the probability and the bankroll, you get the stake the formula suggests.

The Kelly fraction controls how cautiously you play. 1 is standard, and the closer to 0 you go, the more cautious the stake. The formula only helps if your estimate of the probability is right, and then it can give more value over time.

The formula only suggests a stake when the odds are higher than the chance justifies, that is on a value bet. You work out the expected value in the value bet calculator, and Edge's tool for value betting looks for such odds at bookmakers with a Swedish licence.

Whether your estimate is right only shows after many bets. Save them in My Bets and you see your ROI and your result over time.

How big should the bankroll be?

The bankroll is the money you have set aside for betting, separate from rent, food and savings. Kelly works on that money and no other. Count it in units: one unit is one per cent of the bankroll, and that is how the system's own stakes are stated.

How big it needs to be is decided by the variance, not by the formula. The system's value bets returned plus 610.29 units on 31,716 settled bets from 1 March to 29 October 2026. That is an ROI of 2.49 per cent. Even so, the largest drawdown was 53.40 units, from the peak on 15 May to the bottom on 3 June. Only on 25 June, 41 days after the peak, was the result back.

With one per cent per unit that drawdown is a little over half the bankroll. With two per cent per unit the same drawdown would have been more than the whole bankroll. That is why most people work with quarter Kelly and one unit at one per cent. Not because the growth is higher, but so that the bankroll is still there when the drawdown comes.

Count the time too. 22 of 34 full weeks ended in profit, and the longest losing run was five weeks. Only after 5,842 settled bets did 95 of 100 resamples of the period end in profit. So a bankroll has to survive thousands of bets, not one month. The glossary page on bankroll shows what ten losses in a row do to the bankroll. My Bets saves stake, odds and result so you can see where you stand.

Gamble responsibly

If you notice that you raise your stakes to catch up, or that gambling takes up more room than you want, Stödlinjen, the Swedish gambling helpline, is on 020-81 91 00, and through Spelpaus you can exclude yourself from gambling. Kelly is a tool for discipline, not a reason to gamble more.