Can we talk money management? (newbies listen up!)

[SBR_John]

I truly believe that poor money management is the root of all evil. So often very good handicappers go broke. Why? Regular guys let gambling batter them because of bad money management.

Here is my simple money management strategy:

The 20% Rule

Never risk more than 20% of your weekly income on gambling. Don’t be a big shot. Play within your bankroll.

Never vary your bets by more than 20%. If your standard bet is $100 your MAX bet would be $120. Your min bet would be $80. If a game is such a weak play you cant justify $80 then take a pass.

Never bet more than 20% of your weekly allotted bankroll on any single play.

[pico]

I truly believe that poor money management is the root of all evil. So often very good handicappers go broke. Why? Regular guys let gambling batter them because of bad money management.

Here is my simple money management strategy:

The 20% Rule

Never risk more than 20% of your weekly income on gambling. Don’t be a big shot. Play within your bankroll.

Never vary your bets by more than 20%. If your standard bet is $100 your MAX bet would be $120. Your min bet would be $80. If a game is such a weak play you cant justify $80 then take a pass.

Never bet more than 20% of your weekly allotted bankroll on any single play.

what if your income is 0?

[BatemanPatrickl]

Good post SBR John; please PM this to JJ.

[GitRDone]

I truly believe that poor money management is the root of all evil. So often very good handicappers go broke. Why? Regular guys let gambling batter them because of bad money management.

Here is my simple money management strategy:

The 20% Rule

Never risk more than 20% of your weekly income on gambling. Don’t be a big shot. Play within your bankroll.

Never vary your bets by more than 20%. If your standard bet is $100 your MAX bet would be $120. Your min bet would be $80. If a game is such a weak play you cant justify $80 then take a pass.

Never bet more than 20% of your weekly allotted bankroll on any single play.

All excellent points John. When first starting out, you must realize (this is a must) that "winning" gambling is a marathon not a sprint. You will always have ups and downs. Sure everyone wants to be able to say that they have tens or even hundreds of thousands in their account but in all realistically, most don't. The most important advice I could tell someone who is just starting to gamble is that YOU MUST NOT GET GREEDY! Becoming to greedy will kill your bankroll (if not eliminate it). This isn't a get rich right away opportunity. One other main point I want to get through to the newbies is NEVER, EVER CHASE A BET. This along with getting too greedy are the main 2 reasons why people lose their entire bankroll.
I am a little more conservative than John , I don't bet more than 10% of my bankroll on any single play but ultimately it is your decision to make. Hopefully (and I am sure they will) others will put in their 2 cents and teach the newbies what mistakes we had to go through so in turn you won't have to go through these same ones. Best of luck to everyone and remember to be patient.

GitRDone

[stump]

poor money management ko's more gamblers than poor capping

[RageWizard]

I found that if I make a plan for the season and stick to it I come out ahead.

[LT Profits]

Once you have a bankroll set aside, I prefer to always bet the same percentage of bankroll on every play. This naturally increases your bets when you win and decreases them when you are down. I am not a big proponent of rating plays, and on the very rare occasions that I do have Best Bets, I usually only bet 1% more on them than usual (3.5% of BR instead of 2.5%).

Also, and this is just me, I always withdraw funds when my total online balance exceeds 20k. Therefore, the MOST I bet on one game is $700 (3.5% Best Bet with 20K BR). 20K may sound like a lot, but when you have like six outs like I do that are relatively well funded, you'd be surprised at how easily attainable it is.

[tblues2005]

I agree SBR John I think you need to have a budget that you can spend and don't over do it. I have seen people that has gotten in trouble by over doing it and trying to force plays when really there isn't one. Just go with your Bet Bets and that is it, is what I do.

[jjgold]

Put $10,000 outside anything less and you should not be gambling. With the $10,000 bet $100 per game and never change your bet size and only bet like 5 games per week at best. If you follow these simple things you will never lose that much.

[GitRDone]

Put $10,000 outside anything less and you should not be gambling. With the $10,000 bet $100 per game and never change your bet size and only bet like 5 games per week at best. If you follow these simple things you will never lose that much.

This is coming from someone who supposedly had 40K in their account and lost it all. Oh yeah, how about having someone place a 3K bet for you when you don't have that money. To me you are a pathetic gambler who has no business giving newbies advice on money management.

[jjgold]

Well if you read my post it is excellent advice, I did not say anything stupid.

[GitRDone]

You don't need to have 10K to gamble. That is the stupidest thing I've ever heard. Their is NO set amount you have to have to gamble. Why even say something as stupid as that?

[SBR Lou]

Because he has no respect for money, especially anything he perceives as small time, however this isn't necessarily a bad thing. Being a gambler sometimes you have to jump on an opportunity, and fire hard. Many overly conservative guys would never let themselves take too big a risk, while guys like JJ would in a flash. This of course greatly increases your risk of going broke if you cannot control yourself beyond a certain point, however being a degenerate "in moderation" if that makes absolutely any sense can be very profitable.

[SBR_John]

Most guys around here would probably be surprized that the average bet size at a major sportsbook is about $70. Thats it.

You dont need to plunge your brains out to make money and have fun.

I've been on a couple of bookie payment plans because I couldnt manage my cash in my early years. Pain. Pain...

If you have been playing over your budget for a long time consider making some changes this year.

[jjgold]

Well then if you have $100 you should not play more than $5 a game

Lets compare, I have $10k and bet $100 a game and then a guy has $100 and bets it all on one game?? The guy betting it all has a gambling problem even though I ahve 10 Dimes in my account and he ahs $100.

Most guys could not do what I do, when your a pro like me or Ganch you need to take masssive shots to stay in the game. I in no way advise anyone to bet like me.

PAy attention to SBR Johns post

[Starbuckibm]

Most guys could not do what I do, when your a pro like me or Ganch you need to take masssive shots to stay in the game. I in no way advise anyone to bet like me.

PAy attention to SBR Johns post

JJ if everyone did what you did they would all be losers. I've made a ton last week and even tonight fading against you. Why don't you send me your money and at the end of the season I will have you up +50 units.

[steelerfan]

betting into a book that has high juice is also poor money management. that will kill you too.

[pokernut9999]

Stay away from teasers and parlays. Losers in the long run.
Dont bet a game just because it is on TV.
Dont chase when losing.

[LargeMouthBass]

I brought this up couple weeks ago... Though, Dante thinks money management is overrated, I personally think it's one of the hardest things to do for a bettor. Keep it consistent and never chase... GL

[pokernut9999]

I brought this up couple weeks ago... Though, Dante thinks money management is overrated, I personally think it's one of the hardest things to do for a bettor. Keep it consistent and never chase... GL

He thinks trends are overrated also.

[WileOut]

Stay away from teasers and parlays. Losers in the long run.

False statement. Somebody here has proven that small parlays are winners if you can win like 55% or more of all individual picks. Also, football teasers that go across key numbers can be a great tool.

[pokernut9999]

They named it TEASER for a reason !!! Yes some people may win with teasers but majority lose with them. My bookie had one person out of many hit a parlay last week. Parlays and teasers are sucker bets. How can someone that hits 55% come out ahead on parlays? Love to hear your explanation there.

[Ganchrow]

How can someone that hits 55% come out ahead on parlays? Love to hear your explanation there.

The math is rather straightforward. See Parlays and Correlated Parlays.

Note however that for a typical player this doesn't necessarily imply that a parlay is a superior choice to some combination of the underlying straight bets. In fact in general it usually is not.

[pokernut9999]

The math is rather straightforward. See Parlays and Correlated Parlays.

Note however that this doesn't necessarily imply that a parlay is a superior choice to some combination of the underlying straight bets.

The math may be, but how many people hit more than 55%

That is the problem. I have seen enough parlay's over the years and no bookie fears them.

Newbies should stay away from them, that is the thread here.

[pokernut9999]

Actually the math is how you plug in your numbers.

Let's say you have 9 teams you like. You hit 55%, that is 5 winners and 4 losers. You parlay all the teams every combination. That is 36 (2 team) parlays @ $100 a pop. Total investment is $3600.


losing paralys 30 = - $3000
winning parlays 6 = +$1560


net = - $1440

[durito]

Once you have a bankroll set aside, I prefer to always bet the same percentage of bankroll on every play. This naturally increases your bets when you win and decreases them when you are down. I am not a big proponent of rating plays, and on the very rare occasions that I do have Best Bets, I usually only bet 1% more on them than usual (3.5% of BR instead of 2.5%).

Also, and this is just me, I always withdraw funds when my total online balance exceeds 20k. Therefore, the MOST I bet on one game is $700 (3.5% Best Bet with 20K BR). 20K may sound like a lot, but when you have like six outs like I do that are relatively well funded, you'd be surprised at how easily attainable it is.

You make your primary income betting those amounts?

[Ganchrow]

Actually the math is how you plug in your numbers.

Let's say you have 9 teams you like. You hit 55%, that is 5 winners and 4 losers. You parlay all the teams every combination. That is 36 (2 team) parlays @ $100 a pop. Total investment is $3600.


losing paralys 30 = - $3000
winning parlays 6 = +$1560


net = - $1440

Your math and reasoning are incorrect in two regards.

Firstly, if you go on 5-4 you'd win combin(5,2) = 10 parlays, not 6. Hence at true parlay odds you'd have won 10 parlays (10 × 2.6446281 × $100 ≈ +$2644.6281) and lost 26 (26 × -$100 = -$2600) for a net profit of $44.6281. See my round-robin calculator.

Let's see if anyone can figure out what your second mistake was. (Hint: it has to do with the difference between a mean and a median.)

[pokernut9999]

with 4 winners you can only have 6 winning 2 team parlays

1 and 2 2 and 3 3 and 4
1 and 3 2 and 4
1 and 4


no way can you have 10


9 teams give you 36 combos 30 lose 6 win

[Ganchrow]

with 4 winners you can only have 6 winning 2 team parlays

1 and 2 2 and 3 3 and 4
1 and 3 2 and 4
1 and 4


no way can you have 10


9 teams give you 36 combos 30 lose 6 win

There are 5 single game winners and 4 single game losers.

The 10 (=combin(5,2)) 2-team parlay winners would be:

1. 1/2
2. 1/3
3. 1/4
4. 1/5
5. 2/3
6. 2/4
7. 2/5
8. 3/4
9. 3/5
10. 4/5

[pokernut9999]

Your math and reasoning are incorrect in two regards.

Firstly, if you go on 5-4 you'd win combin(5,2) = 10 parlays, not 6. Hence at true parlay odds you'd have won 10 parlays (10 × 2.6446281 × $100 ≈ +$2644.6281) and lost 26 (26 × -$100 = -$2600) for a net profit of $44.6281. See my round-robin calculator.

Let's see if anyone can figure out what your second mistake was. (Hint: it has to do with the difference between a mean and a median.)

LOL how long till you see your GLARING mistake !!!!

[pokernut9999]

A parlay is only going to pay 260 so one would break even
where as one would win 60 betting straight up. Sorry I am trying to watch movie and messed up. I apologize I figured 4 not 5. Sorry about that. My bad , once again sorry about that.

[pags11]

I save up my bankroll during the summer and then deposit it amongst four books...never play more than 5% of my bankroll on one play and try not to chase...has worked out alright for me...

[Ganchrow]

A parlay is only going to pay 260 so one would break even
where as one would win 60 betting straight up. Sorry I am trying to watch movie and messed up. I apologize I figured 4 not 5. Sorry about that. My bad , once again sorry about that.

No worries.

You're obviously correct that a parlay that pays out at worse than true parlay odds will provide diminished value. But that's not an indictment of parlays as a market instrument but rather of those books that only pay out at 2.6/1 on a 2-team parlay. Many books, such as Pinnacle and CRIS, will pay true parlay odds of about +264.46 on two teams parlayed at -110. (And even at books that only pay +260 on -110 2-teamers, you can still receive true parlay odds when you parlay, for example, a line of -110 and a line of -111. And of course let's not forget that 6/1 on a 3-teamer is better than true parlay odds).

Now the other problem with your analysis is that you're not actually considering the expectation of playing the 2-team parlays, but rather the median resultant outcome (which in this case corresponds to the most likely outcome). This is an important distinction because from a total return perspective what's relevant is one's expected average performance over a large number of occurrences. Because the distribution of returns is positively skewed (meaning that one has a fairly small probability of winning a fairly large amount, and a fairly large probability of losing a fairly small amount) the expected return will necessarily be higher than the median return.

In fact if we look at the expected for return a 55.56% single at -110 we find an expectation of about 55.55%×1.9091-1 ≈ 6.06%.

Compare this to the expected return of a 2-team parlay at of two -110 events which we expect to hit with probability 55.56%, which is (55.55%×1.9091)²-1 ≈ 12.49%.

Now all this said, here's one important caveat. For a full-Kelly bettor the relevant statistic is the median outcome and not the mean outcome. So for precisely the reason that you've given (a higher median outcome on the singles), a bettor seeking to maximize his expected bankroll growth would in this case strictly prefer the two single bets to the 2-team parlay. (Although of course even better would be some combination of the two singles and the one parlay).

So hopefully this helps illustrate the dichotomous nature of the comparison between single bets and parlays. For +EV bets, while a bettor can always increase his expected return by betting parlays in preference to the underlying singles, for a Kelly or fractional Kelly bettor it will almost never be optimal (except in some pathological cases involving very large favorites) to actually do so.

[SBR_John]

And don't buy points either. The head of Pinnacle told me they id and label a guy as a square if they buy points.

[Dark Horse]

Buying points on/off and through 3, and on/off 7 is by definition square?