Kelly Criterion Calculator — Horse Racing & Sports Betting (AUD)
Work out how much to stake from your edge using full, half or quarter Kelly.
The Kelly criterion turns a probability edge into a stake size. Give it your bankroll, the win chance you’ve assessed for a runner or team, and the decimal odds on offer, and it returns the fraction of your bankroll the Kelly formula says to risk.
Most disciplined punters use a fraction of full Kelly — half or quarter — because full Kelly is mathematically optimal but uncomfortably volatile. This calculator lets you pick the fraction and see the stake, your edge over the market, and the expected value of the bet.
How it works
Kelly stakes more when your edge is bigger and the price is longer, and nothing at all when you have no edge. “Edge” here is how far your assessed probability sits above the probability implied by the odds.
If you bet on a betting exchange, add the commission percentage so the maths uses your net odds after the cut. A negative-edge bet returns a zero stake — the calculator never tells you to back something you’ve priced as an underlay.
fraction of bankroll = ( b·p − q ) ÷ b where b = odds − 1, p = your probability, q = 1 − p
Worked example
- Market-implied probability: 47.6% (1 ÷ 2.10)
- Your edge over the market: ~15.5%
- Full-Kelly fraction: ~14.1% of bankroll
- Half-Kelly stake: ~$70.45
- Expected value of that stake: ~$10.92
Half Kelly roughly halves the swings for about three-quarters of the long-run growth — a common, sensible trade-off.
FAQ
- What is the Kelly criterion?
- A formula that sets your stake as a fraction of your bankroll based on your edge and the odds, to maximise long-run bankroll growth without risking ruin.
- Should I use full or half Kelly?
- Most bettors use half or quarter Kelly. Full Kelly grows fastest in theory but the swings are large and any error in your probability estimate is amplified.
- What if I have no edge?
- If your assessed probability is at or below the odds-implied probability, Kelly returns a zero stake — there is no bet to make.
- Does this handle exchange commission?
- Yes. Enter your commission percentage and the stake is calculated from your net odds after the exchange’s cut.
- Is this gambling advice?
- No. It is an educational staking calculator. It does not predict outcomes, choose selections, or place bets — you supply the probability.
This is the textbook Kelly formula. Edge Protocol is the full system — commission-aware, edge-tiered staking with hard stop-losses and closing-line-value tracking.
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