Discover your optimal bet size or investment allocation with our free Kelly Criterion Calculator. This powerful mathematical formula helps you maximize long-term capital growth while managing risk. Apply the Kelly Criterion to sports betting, stock trading, or any scenario with quantifiable probabilities and odds.
Formula:
The Kelly Criterion formula calculates the optimal fraction (f) of your bankroll to wager, based on your estimated probability of winning (p) and the odds you're offered (b). Let q be the probability of losing, where q = 1 - p.
Formula:
f = p - (q / b)
Where:
- f = The optimal fraction of your bankroll to bet (as a decimal)
- p = Your perceived probability of winning (as a decimal, e.g., 0.55 for 55%)
- q = Your perceived probability of losing (
1 - p) - b = The net odds received (e.g., if odds are 2:1, b = 2)
A positive 'f' indicates an advantage, while a negative 'f' suggests you shouldn't bet.