Handicapping Guide: Bankrolling and Money Management

May 22, 2009


Patrick Griffith asked:

Professional Handicapping Service – Spider Web Sports

Bankrolling and Money Management

Many people who are great at handicapping games always end up going bust. Why? Improper money management. The most important piece of knowledge for a sports bettor, whether casual or professional, is how to properly manage his money and fund his bankroll.

Common Mistakes Fluctuating Bet Size: This is perhaps the single biggest mistake made by bettors. You should be risking one unit on every bet regardless of the line, your perceived chances of winning, your incredible winning streak, or what color pants your wife is wearing. If you are good at picking games then you WILL make money in the long run. A successful bettor’s goal is to make as many +EV bets as possible to minimize variance. Fluctuating the size of your bets insures that variance will be playing a lead role in your success. Setting the Size of Your Bankroll: Everybody says it, and it’s good advice; Never bet more than you can afford to lose. Don’t bet your rent money. Don’t pawn your mom’s wedding ring. You want your bankroll to be as large as possible without crossing the line of irresponsibility. Betting the Wrong Amount: Once your bankroll has been set, you need to be responsible in deciding how much to bet on each game – the size of your betting unit. Contrary to popular belief, big units don’t always get the ladies. Everybody, even the best sports handicappers in the world, has losing streaks. Betting 25% of your bankroll on every pick is just asking to be wiped out by variance. You should never be betting more than 4% on a pick, and even that is pushing it. Not Betting the Right Amount: Ok, you caught me. This is just a continuation of the previous bullet. A less serious, but extremely common mistake is to never increase the size of your bet as your bankroll grows. If you have an intial bankroll of $1,000 and are making $20 bets, it would be incorrect to still be making $20 bets once your bankroll has grown to be $1,700. You should recalculate the size of your bets once a month or so. Just be sure the bet size stays as a fixed percentage of your bankroll. To see an example of why this is so important check out our article on maximizing ROI. This article uses real numbers from our picks in the 2008 MLB season. By resizing our bets at the end of every month we had an ROI of 1,580.53% compared to the ROI of 378.48% that we would have had if we didn’t resize our bets all season. The difference is astounding.

That’s about all there is to it. Money management is very simple, but it takes discipline to adhere to. Don’t fluctuate the size of your bets, don’t bet more than you can afford to lose, only bet a small percentage of your bankroll and don’t forget to keep your bet size in proportion with your bankroll size. Follow those simple steps and you’ll be on your way to success.

To see this article along with many other free gambling articles visit our Sports Betting and Handicapping site.

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