What is a bankroll?
A bankroll is the total amount of money that you are allocating to betting. It is very important that your stake size (amount that you place per bet) is small enough for your bankroll. On the flip side, if you place too little per bet, you are not optimising the amount of money you can make value betting. Your bankroll will change during your value betting journey, so it's important that you update your stake size often depending on how much you have.
How to know how much I need to stake per bet?
You need to aim betting around 1-2% of your bankroll per bet. For example, if you have a bankroll of 2000$, you should aim to place 20-40$ per bet, depending on how agressive you want to be and how much variance you are willing to tolerate (higher stakes will mean higher swings in profit and losses).
To avoid being limited quickly, you should try to bet the same amount per bet. Using the Kelly Criterion can optimise your profit and loss and help reduce variance, however your account will likely be flagged very quickly. The Kelly Criterion is essentially staking such that your returns always stay the same for each win, here an example:
- Betting 20$ on odds of 2 are going to return 40$ if you win
- So if you bet on odds of 4, you should place 10$ on that bet, so your return will stay the same if you win.