Kelly Criterion Calculator
What is the Kelly Criterion?
The Kelly Criterion calculator tells you what percentage of your betting bank to stake on a bet, based on your edge over the bookmaker. Enter the bookmaker's odds, your estimated probability of winning, and your bank size — the calculator outputs the mathematically optimal stake to maximise long-term growth while managing risk.
Kelly Formula Explained
The standard Kelly formula is:
where:
• b = net decimal odds (i.e. decimal odds − 1)
• p = your estimated probability of winning (as a decimal, e.g. 0.55)
• q = probability of losing = 1 − p
• f* = fraction of bankroll to bet
If f* is negative or zero, the Kelly Criterion says do not bet — there is no mathematical edge at the offered odds. The calculator above applies this formula and optionally divides the result by 2 (Half Kelly) or 4 (Quarter Kelly).
Full Kelly vs Half Kelly vs Quarter Kelly
Full Kelly maximises bankroll growth in theory, but it comes with extreme variance — drawdowns of 50% or more are common. Most professional bettors use Half Kelly or Quarter Kelly. Half Kelly reduces variance by roughly 75% while capturing around 75% of the growth rate. Quarter Kelly is very conservative and suits punters who want steady growth with minimal swings. The calculator defaults to Half Kelly for this reason.
Kelly Criterion Example
Suppose your bankroll is €500. You estimate a football match has a 55% chance of the home team winning, and you find odds of 2.10 (decimal) on that outcome. Using the Kelly formula: b = 1.10, p = 0.55, q = 0.45. f* = (1.10 × 0.55 − 0.45) / 1.10 = (0.605 − 0.45) / 1.10 = 0.155 / 1.10 ≈ 14.1%. Half Kelly = 7.05%, so the recommended stake is €500 × 0.0705 = €35.25.
Limitations of the Kelly Criterion
Kelly only works if your probability estimate is accurate. In practice, punters regularly overestimate their edge, which leads to overbetting and ruin. The formula also assumes bets are independent and that you can place any stake size — neither is fully true in real betting markets. Bookmakers impose maximum stakes, and odds can move before you get on. Use Kelly as a guide, not a guarantee, and always apply a fractional Kelly to protect your bankroll from estimation errors.
Frequently Asked Questions
The Kelly Criterion is a formula that calculates the optimal fraction of your bankroll to bet based on your estimated edge and the offered odds, maximising long-run bankroll growth while avoiding ruin.
Betting half the Kelly-recommended stake. It significantly reduces variance and drawdowns while still capturing most of the long-run growth benefit. Most professional bettors use half or quarter Kelly.
A negative Kelly value means no mathematical edge — the bet has negative expected value at the offered odds. The correct action is not to bet.
Kelly is designed for single bets. For accumulators you would need to chain the calculation across each leg, which compounds estimation error. It is best used for single-event wagers.
Yes — it is widely used in professional sports betting, trading and investment management. Most practitioners use fractional Kelly (half or quarter) to manage the high variance that comes with full Kelly staking.