When it comes to football betting finding out which the most efficient tactic to use can be a tiresome process. Especially when you have no experience in placing wagers on this particular sport. Lucky for you, the Kelly criterion requires nothing more than a basic understanding of maths and time, a LOT of time.
What is the Kelly criterion?
Since you came here to read about football we are only going to elaborate on this rather than talking about how the Kelly criterion can be applied to other sports or gambling. So what exactly is this “perfect” betting system all about?
The Kelly Criterion requires the player, that’s you, to carefully study the odds offered by the bookmakers and by using a specific formula decide the exact bet he should place. But this is only the beginning. If it was that easy to make money using this method then everyone would be doing it.
What do you need to increase your winning rate?
Before we go into further details, here is the formula we will be using:
[(Probability * odds)-1] / (odds-1)
This is how you will be able to calculate the stake you have to place. But you must be wondering how we made it to this formula, right? Let’s take a look at all those things you probably have no idea about!
In order for you to understand the method better, we will start with an example. Suppose that there is an upcoming game between Tottenham and Chelsea. The 1 gives an odd of 1.65, the x gives 3.50, and the 2 gives 2.20
By this you would clearly think that the favorite to win is Tottenham. But we don’t care about the team that gets three points, we are here to help you see how you can find what we call a value bet.
A value bet is when the bookmaker is offering an odd that has a higher possibility of paying out than it should really be. But you can’t know for sure how big or small the odd should be and this is where the Kelly criterion lacks. You have to do something as well.
According to our previous example, if you see things objectively you should know that the game’s possibility of ending up in a draw should be around 47.5% but the bookmaker has made a mistake, he didn’t think you would have a better insight than him.
Here is another formula that will help you find out the implied probability.
Implied Probability (IP) = 1 / decimal odds
Thus, in our example, our result would be IP = 1 / 3.50 = 0.28. So the implied probability here is roughly 28% while realistically it should be around 33%. That means that you have an edge of 5% (33% – 28%). And that means that this would indeed be a value bet.
So using the stake calculation formula we previously mentioned here is how much of your bankroll you should be on the away win.
[(0.33 * 3.50) – 1] / (3.50 – 1)
= (1.155 – 1) / 2.50
= 0.155 / 2.50
= 0.062 (roughly 6%)
So that means that you should bet around 6% of your bankroll to this draw. This is just an example though.
How to accurately calculate the probability?
You already know how to calculate the potential bet you have to place but how will you be able to determine whether taking up an odd is or isn’t a value bet? There are some things you should pay attention to.
Since this isn’t roulette, there isn’t a guaranteed way to calculate the probability of an outcome. Each player has a different method they like to use. Some target specific leagues and tournaments while others take up only a couple of teams to bet on. No matter which way you go some things remain the same.
First up, see how many of the last 10 games the team in question has won, lose, or tied. Do the same for the other team.
For example, if Team A has won 6 of the last 10 games then their win rate is 60%. If Team B has won 5 of theirs, then 50% would be their rate. But that doesn’t mean that Team A is better than Team B or has a better chance of winning.
This is why you will have to form your own method. Take into consideration everything that counts. How many goals per game does an attacker score, past results between the two teams, injuries, form, everything that you can think of. Then form what you think should be their odds of winning and you are good to go.
The Kelly Criterion drawbacks
No system is perfect but the Kelly criterion is close to being one as many people believe it is the best one you can use in order to slowly but steadily increase your bankroll. Here are some of its drawbacks:
- Unless you bet a lot of money then the possible profit may not be worth all the time that went into thinking about the bet
- Each game has 3 possible outcomes which make it difficult to accurately calculate the probability.
- You will have to target mostly draws (or the underdog). Going with the obvious winner is most likely to make you lose money in the long run.
Still, the Kelly Criterion is considered to be one of the very best betting methods you can use to maximize both the odds of winning and the potential profits and this is exactly the reason you have to try it out. After all, you are a punter and all serious punters have had to go through an assortment of tactics before picking the one that works the best for them.
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