- Discover why staking methods are important in betting
- Learn about the most common staking methods
- Find out which staking method is best
The significance of your wager amount arguably surpasses the importance of what you are betting on. We have analyzed five prominent staking methods. Continue to find out the most effective one.
Ed Thorp, a professional blackjack player and writer, excelled at card counting. His proficiency was so notable that it prompted casinos in Las Vegas to introduce multiple decks and combat card counting aggressively.
Despite being an adept gambler and having authored two books on gambling, he credits a significant portion of his success to a staking formula devised by mathematician John Kelly Jr. Thorp stated, “Strategy in play accounts for maybe a third to a quarter of your potential earnings. The bulk of your earnings will likely come from how you bet, possibly up to two-thirds or three-quarters.”
It’s one thing to acknowledge the importance of a betting strategy, but what constitutes a practical strategy in sports betting? Drawing inspiration from Alex Bellos' "Alex's Adventures in Numberland," we charted the performance of five betting strategies across 500 bets:
The graph illustrates the earnings from 500 simulated wagers using five different betting strategies, with a 55% winning probability on a Binary bet. The starting bet was $100 for each strategy, except for the all-in strategy, which began with $1000. Each strategy had a $1000 bankroll, and the simulation was carried out up to the 500th bet or until the bankroll was depleted.
As depicted, one betting strategy yields significantly higher returns than the others, while another quickly depletes your funds.
Below are descriptions of the five strategies. Can you match each strategy with its corresponding letter?
Strategy 1: All-in
Wager your entire bankroll each time. This strategy offers large returns quickly. The downside? A single loss means you're completely out of funds.
Strategy 2: Fixed Bet
Place a constant bet amount for every wager, without adjusting for wins or losses. In this case, it was $100. With a 55% winning chance on a 2.000 bet, this approach greatly reduces the risk of losing your entire bankroll. However, it also limits how fast your winnings can grow, yielding a slow and steady increase.
Strategy 3: Martingale
After a loss, double your bet to recoup past losses with the next win. This can lead to quicker gains than constant bets by doubling up to recover losses. However, consecutive losses quickly escalate the required stake, potentially leading to high bets to cover previous losses.
Strategy 4: Fibonacci
Following a loss, increase your bet based on the Fibonacci sequence to recover previous losses with future wins. This strategy shares the Martingale's drawbacks in sports betting but slows the stake increase rate during a losing streak, thereby slowing the winning rate as well.
Strategy 5: Proportional betting
Wager a portion of your bankroll based on your advantage. We applied the Kelly Criterion formula for proportional sports betting in our simulation. Here, your bet is your edge divided by the odds. Given a 10% edge and even odds, the formula suggests betting 10%.
Hence, $100 or 10% of the $1000 bankroll was bet. A successful bet means the next wager would be $110, 10% of the new $1100 bankroll. This leads to quicker increases in winnings compared to the constant bet system, with slower losses.
Which strategy is best?
The correct answer is:
A. All-in
B. Martingale
C. Fixed wager
D. Proportional Betting
E. Fibonacci
Proportional betting inherently seems more advantageous than the other methods. If reduced to your last $100, you would bet $10, decreasing further, allowing you to stay in the game much longer than with a constant bet system, where your final $100 would also be your last bet.
The all-in method sees substantial gains after the initial bet, accumulating as much in one risk as others do over seven. Yet, the brilliance of the all-in betting strategy fades quickly, being eliminated by the second round.
The likelihood of surviving 1,000 rounds at a 55% win rate is nearly non-existent, though you'd have amassed $67 billion by round 27.
Our simulation reveals that staking strategies can lead to significantly varied outcomes, even with consistent variables. Fibonacci and Martingale, both progressive betting systems, start strong, but a series of losses can rapidly increase the required bet amount.
In our model, at round 83 (R83), we encountered a losing streak of 11 bets. This streak obliterated the stakes for both Fibonacci and Martingale strategies, with the hypothetical Martingale better needing to wager $403,000 to recover his losses, a substantial sum considering his maximum bank was $6,300. For Fibonacci, the maximum bet reached $33,500, with the bank peaking at $4,100 before the downturn.
The only strategy besides proportional betting that avoided losses was constant betting, which saw slow but consistent gains. By R83, constant betting increased its bank to $3,400, later dropping to $2,300. Though not wiped out, it showed modest progress after 95 bets.
The 11-bet losing streak significantly impacted proportional betting, reducing its gains from $7,359 to $2,286, lower than constant betting. Yet, by the 500th bet, constant betting accrued $6,400, whereas proportional betting amassed $18,275.
It's crucial for bettors to recognize this outcome assumes the bettor's edge is advantageous; without it, the results for all staking strategies would drastically change.
Backing your staking technique
The simulation underscores how different staking methods can result in divergent outcomes, even when other variables remain constant. The distinction between depleting your bankroll and finishing with $18,275 after 500 bets essentially comes down to selecting an appropriate staking strategy.
Nevertheless, it's vital to understand that no strategy is flawless. Although the Kelly Criterion proved effective in our example, other, more sophisticated systems may suit different betting scenarios better. Identifying the most fitting staking style for your sports betting endeavors often requires thorough research and simulation.
Moreover, the success of the Kelly Criterion hinges on accurately knowing your edge, which is crucial for determining your stake. An inaccurate edge calculation means you'll face challenges regardless of your approach. Exploring the rest of our Betting Resources archive can enhance your grasp of betting formulas and strategies.
Now you know how to improve your betting using staking strategy. Sign Up Now or click HERE to play at 7x7Bets, the most reliable and trustworthy online casino in India. Don't forget to claim your withdrawable real money welcome deposit bonus, weekly cashback bonus and referral bonus!