Free tool
Kelly criterion calculator.
Stake sizing as architecture, not a gut feeling. Kelly sizes a bet to your edge — bigger edge, bigger stake; no edge, no bet — and it only works if your probability is honest.
Kelly is only as good as your probability. Feed it an honest estimate and it sizes beautifully; feed it wishful thinking and it over-stakes and can wreck a bankroll. It's a sizing discipline, not an edge, and most serious users run half or quarter Kelly precisely because their estimates are never perfect.
The worked example
Odds of 3.0 with a 40% estimated chance: Kelly fraction = (3.0 × 0.40 − 1) ÷ (3.0 − 1) = 0.20 ÷ 2 = 10% of bankroll. On £1,000 that's £100 at full Kelly, £50 at half. Your edge is 3.0 × 0.40 − 1 = +20% expected value. Drop the estimate to 33.3% and Kelly falls to zero — no edge, no bet.
Straight answers
What is the Kelly criterion?
A staking formula that sizes each bet in proportion to your edge, to maximise the long-run growth of a bankroll. It only stakes when your estimated probability beats the price, and it stakes more the bigger the edge — and nothing at all when there is no edge.
What is the Kelly criterion formula?
Kelly fraction = (odds × probability − 1) ÷ (odds − 1), where odds are decimal and probability is your estimated true chance. The stake is that fraction of your bankroll. If the result is zero or negative, the formula says do not bet.
Why use half or quarter Kelly?
Full Kelly is mathematically optimal but brutally volatile, and it assumes your probability estimate is exactly right — which it never is. Halving or quartering the fraction sacrifices a little theoretical growth for a large reduction in swings and in the damage done by over-estimating your edge.
Does Kelly staking guarantee profit?
No. Kelly only optimises growth if your probability estimates are genuinely accurate; feed it an over-confident number and it will over-stake and can ruin a bankroll. It is a discipline for sizing, not a source of edge, and it cannot turn a losing method into a winning one.
Kelly sizes the bet. Estimating the probability honestly is the whole discipline.
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18+ · Education, not betting advice · No tips, no picks · BeGambleAware.org
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