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DaPex LabsAnswer Capsule: The Kelly Criterion for betting: f* = (bp-q)/b where b = decimal odds - 1, p = your win probability. Most professional bettors use Quarter-Kelly. Never use Martingale — it guarantees eventual ruin.
The Kelly Criterion for betting: f* = (bp-q)/b where b = decimal odds - 1, p = your win probability. Most professional bettors use Quarter-Kelly. Never use Martingale — it guarantees eventual ruin.
Trading and betting share the same mathematical foundation. Here is how professional bettors manage their bankroll using the same tools that hedge funds use.
A bettor with a 55% win rate and terrible staking will go broke. A bettor with 45% accuracy and proper staking will grow their bankroll. The math doesn't care about your picks — it only cares about your bet sizing.
The Kelly formula tells you the optimal fraction of your bankroll to wager on each bet: f* = (bp - q) / b where b = decimal odds - 1, p = your estimated win probability, q = 1 - p.
Example: You estimate Team A has a 60% chance to win at odds of 2.00 (even money). b = 1, p = 0.60, q = 0.40. Kelly stake = (1×0.60 - 0.40)/1 = 20% of bankroll.
| Plan | Stake Per Bet | Risk Level | Best For |
|---|---|---|---|
| Flat Staking | 1-2% of bankroll fixed | Low | Beginners, conservative |
| Fractional Kelly (1/4) | Kelly ÷ 4 | Low-Medium | Most professionals |
| Half Kelly | Kelly ÷ 2 | Medium | Experienced bettors |
| Full Kelly | Full Kelly fraction | High | Theoretical maximum |
| Martingale (Avoid!) | Double after loss | Extreme | Never use this |
Risk of ruin is the probability you lose your entire bankroll. At 2% flat staking with a 53% win rate at 1.95 odds, your risk of ruin is near zero. At 10% staking, it jumps to over 40%.
The casino never goes broke because they risk tiny fractions of their bankroll on thousands of independent bets with a small edge. You should do the same.
Everything on this page applies equally to trading. Position sizing = bet sizing. Risk of ruin = same formula. Kelly criterion = same formula. The difference is the instrument: sports outcomes vs price movements. The risk management is identical.
If you are a bettor interested in trading, or a trader interested in betting — you already know 90% of what you need. The math is the same.
Same calculators that hedge funds and pro bettors use. All free. No signup.
Kelly Calculator Risk of Ruin Calculator Compound Growth DaPex Terminal | Live ChartReferences: Kelly Criterion (Wikipedia) · Sports Betting Systems (Wikipedia)
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