Kelly bettors, how do you figure out win%
from Ganch's article:
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how do you figure out that you have a 5% edge on certain games? why not 10% or 30%. i think it is pretty impossible to figure out what is your edge is.
**broken link**
Given a bankroll of $10,000 and an edge of 5%, then on a bet at odds of +100 one should wager 5% / (2-1) = 5% of bankroll, or $500.
Given a bankroll of $10,000 and a win probability of 55%, then on a bet at odds of -110, one should wager $10,000 * (55% * 1.909091 - 1) / (1.909091-1) = 5.5% of bankroll, or $550.
Given a bankroll of $10,000 and a win probability of 25% then on a bet at odds of +350, one should wager $10,000 * (25% * 4.5 - 1) / (4.5-1) ≈ 3.57% of bankroll, or about $357.
Given a bankroll of $10,000 and a win probability of 70% then on a bet at odds of -250, one should not wager anything because edge = win prob*odds = 70%*1.4 = 98% < 1.
Given a bankroll of $10,000 and a win probability of 55%, then on a bet at odds of -110, one should wager $10,000 * (55% * 1.909091 - 1) / (1.909091-1) = 5.5% of bankroll, or $550.
Given a bankroll of $10,000 and a win probability of 25% then on a bet at odds of +350, one should wager $10,000 * (25% * 4.5 - 1) / (4.5-1) ≈ 3.57% of bankroll, or about $357.
Given a bankroll of $10,000 and a win probability of 70% then on a bet at odds of -250, one should not wager anything because edge = win prob*odds = 70%*1.4 = 98% < 1.