How to successfully determine your bookmaker bankroll and why is this an extremely important skill?
It is clear that no one can achieve 100% success in betting and therefore good bankroll management is a key part of each player’s outcome. Handling your funds properly can not only keep you in the game longer, but also dramatically increase your winning potential. Improper handling, on the other hand, can cost you even if you enjoy frequent winnings.
This does not only apply to professionals. In this article, we explain what it means to successfully manage your bankroll when it comes to sports betting.
What is bankroll management?
Before we dive into it, let’s first define “bankroll.” In short, this is the money you have set aside for bets. As always, you should never bet more money than you can afford to lose.
Once you determine your bankroll – the maximum you can afford to lose – you must set rules for yourself and how best to distribute the funds. This is often called a “betting plan.” There are different betting plans, which can be customized according to the goals and the size of the player’s bankroll.
Bankroll management includes two key aspects – units and bet tracking:
The unit is the total amount of money you bet on each event. Usually, one unit is between 1 and 3% of the size of your bankroll. If you have a bankroll of 1,000 units, then your unit number should be 10-30. This may not sound like much, but a higher percentage can lower the value of the bankroll in a very short time;
Tracking bets is always a good idea, as it provides even more information that can be stored in the form of a simple spreadsheet.
This approach allows a player to keep a large database of information, which he can then use to analyze his game, and the unit makes sure he avoids emotional bets, which can cause even further damage. Tracking bets is not just a way to keep a history of profits and losses, but a way to see what a player can improve.
Why is bankroll management so important?
Being a successful gambler is about more than just being familiar with the sports you’re betting on. The way a person handles his money can make the difference between big profits and big losses.
There are some specific advantages of proper bankroll management, which form part of the overall betting strategy:
Moderation limits losses
Good resource management keeps you from going bankrupt when luck is not on your side. Even the best players experience horrific losing streaks from time to time. Avoid the temptation to make up for the loss with an even bigger bet and more frequent wagering. The truth is that you’re just as likely to lose again, adding to the series of losses.
Another experience that many players have had involves a lucky streak. After a solid one, you become more likely to overinvest attention to a given bet and quickly lose your hard-earned money.
Discipline and the results that come with it will allow you to overcome losses. In the long run, proper financial management allows you to accept negative events more easily and focus on your plan.
Bankroll management strategies to consider
Assuming you’ve grasped betting units and tracking, let’s move on to a few well-established strategies for your bankroll to consider when looking at their strengths and weaknesses:
Fixed unit model
This is the most basic and easiest model for managing your funds. To apply it, you set the value of your unit – 2% for each bet, regardless of whether you win or lose. As per our previous example, a bankroll of 1000 units would yield a model of 20 units. The method is easy to follow and does not require extensive mathematical skills to apply in tracking bets. The biggest disadvantage of this approach is the limited growth rate of the funds;
This model is similar to the fixed unit model, but instead of betting the same amount as a percentage of your starting funds, this type of bet concerns your current bankroll status. For example, if you start with a bankroll of 1,000 units and have one unit worth 2%, your starting bet, like the other model, will be 20 units. However, the value of the bet varies from day to day, especially in cases where the value of your bankroll has changed and for example has become 1,100. In this case, your bets will increase correspondingly – to 22. If it drops to 800, your bets will also drop – to 16. This model takes advantage of winning series, but suffers in losing streaks, as it takes longer to reverse losses.
Potential return model
While the previous two models take into account the size of your bankroll, this one takes into account the odds. Instead of betting one unit, your goal is to win one. Assuming you’re for the Ohio State Buccaneers against the Michigan Wolverines, the odds are likely to be around -100 for most bookmakers. In this case, instead of betting one, you have to bet 1.10 to win a clean 1.0. One of the advantages here is taking into account that favorites win more often, while underdogs win less often.
This method relies on greater flexibility in bets where you are willing to risk multiple units. This type of tactic requires additional discipline, but also offers additional potential to win. Most confidence models have a scale of 1 to 3 or 1 to 5. Thus, if you set your unit to 1% and have a confidence model of 1-3, in some cases you will be able to bet up to 3% of your bankroll on a single event. The most common classification levels are 1 for low confidence, 2 for medium and 3 for high.
What are the risks of poor bankroll management?
There are countless players in the world who lose their bankroll due to poor money management. Sometimes they do not overcome the losses and try to recover them quickly with big bets, but this is an unjustified risk in many cases.
No style of play will keep you in the game forever. For this reason, almost all players without a solid bankroll management plan will find themselves losing at one point, and the chances of making money in the long run are even lower for people without a plan.
How can bankroll management help increase your profits?
You can’t make money in the long run if you don’t stick to an established action plan. Players who forget this rule can lose everything in a negative series that throws them off-balance.
There are several options for managing sports betting bankrolls that work for both beginners and pro gamblers. The best strategy is the most convenient one that you feel best about, both long- and short-term.