Profit in Gambling Through Value 3

Part 3:  Bankroll Management and Maximizing Your Betting Edge

In the last two parts of this value betting strategy series, I focused on the concept of value and how to find it.

This time I look at bankroll management, and how it can help in maximizing your profit when you do find value. Bankroll management will also reduce the risk of ruin that comes from a losing streak.

In case you missed them, here are the first 2 parts of this value-betting series:

Part 1: What is ‘Value’, and how does it affect your strategy

Part 2: Specializing, beating bookies at their own game

Profit in Gambling Through Value Betting: What is Bankroll Management?

Many people have a very erratic approach to staking when it comes to sports betting. They might suddenly place their entire bankroll on a selection they feel certain of. Some people double their stakes every time they win. I have also seen people increase their stake every time they lose or even bet half their bankroll on a longshot for the sheer fun of it. Go big or go home!

These approaches might be enjoyable. However, if you want to make a regular profit, these approaches are unsustainable over the long term. Simply put, going bust will be a regular occurrence.

Wouldn’t it be better to have an approach where you could never go bust, and if you do have an edge, to make a guaranteed profit from the value bets you find?

This is where bankroll management comes into the picture.

Unit Based Approaches to Betting Bankroll Management

There is a simple bankroll management system that many successful bettors use, and it is a ‘unit based’ system.

The unit system works by assigning a range of units to your betting. In many cases, the unit range is from one to five, but the choice is yours, you could go both higher and lower.

Each unit will represent a percentage of your total bankroll. For example, if you have $5000 to bet with, each unit will be worth $50 (at 1%), or $100 (at 2%).

Units Represent Your Bet Size

Using the five-unit system, you would assign one unit to your smallest bets, moving up to five units for the bets you are the most confident in. The single unit bets should form most of your wagers. As you bet multiple units, you should be more restrictive. In this system, five-unit bets are high-confidence or extreme value bets only. They should be a tiny (<5%) proportion of your bets.

Here is an example:

You go through the days Baseball games, and you have picked five teams you consider are value. They are the Dodgers, Braves, Mets, Orioles and Phillies. You feel that the Braves, the Mets and the Orioles offer some value. You think the Dodgers offer good value, and the Phillies price very much surprised you and it is the bet of the day.

Here is how the unit staking plan might look:

Dodgers:      2 units

Braves:         1 unit

Mets:            1 unit

Orioles:        1 unit

Phillies:        4 units

Here you have staked eight units in total, and half of that is on the Phillies. Being the bet of the day you assign the Phillies bet four points. While it’s not a good enough wager in your mind to hit the maximum five units this is still a high confidence bet. 

You have a bankroll of £1000, so you will wager £80 on these games in total. Each of your units corresponds to 1% of your bankroll.

How conservative you are with units depends on many personal factors. If you are free to top up your bankroll after a bad run, then 2% or even a little higher can work.

Profit in Gambling Through Value: How to Maximize Profits Using Bankroll Management

As a rule, you want to assign more units to the wagers you place where you think you have most value.

If you look back at part two of the series, we saw how to work out odds and compare them to the published odds. You can then use this as a basis for your unit assignment. The bigger the spread between the sportsbook odds and the value you assign, the more units you could bet. Here is a way you could go about it:

1 unit: Sportsbook odds between 1% and 10% above what you have calculated.

2 units: Odds between 11% and 20% above calculation

3 units: Odds between 21% and 30% above calculation

4 units: Odds between 31% and 50% above calculation

5 units: Odds between 51% and 100% above calculation

This is just a suggestion and depending on the types of markets you play, you may have to change these bands. When the maximum edge you’ll ever see is 20%, so you could narrow these bands. The decision is yours, but if you use a staking formula and stick to it, you won’t go wrong.

Profit in Gambling Through Value Betting: Maximizing Profit and Never Going Bust

Using the unit system as a percentage of your bankroll means that it is impossible for you to go bust. There will always be funds left over. As your bankroll increases, so will your stake. However, the swings will not be too wild, and you’ll be able to cope with that losing run (which unfortunately will happen).

Profit in Gambling Through Value: Part Three Overview

This week we saw how good bankroll management can protect you from the swings you’ll have in betting, and how it can maximize your potential earnings. Next week we’ll look at using bonuses and offers in gambling, and the extra value that can bring.