hello all, maybe someone use "Kelly criterion" betting strategy? Is it worth to try?
hello all, maybe someone use "Kelly criterion" betting strategy? Is it worth to try?
Hi idlepick, I will try to explain:
The Kelly Criterion formula is: (bp-q)/b
B = the Decimal odds -1
P = the probability of success
Q = the probability of failure (i.e. 1-p)
Using a coin as an example of Kelly Criterion staking
For example, consider you are betting on a coin to land on heads at 2.00. However, the coin is biased and has a 52% chance of ending up on heads.
In this case:
P= 0.52
Q = 1-0.52 = 0.48
B = 2-1 = 1.
This works out at: (0.52x1 β 0.48) / 1 = 0.04
Therefore the Kelly Criterion would recommend you bet 4% - a positive percentage implies an edge in your favour - of your bankroll so your funds grow exponentially.
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