With the rapid legalization of sports gambling across the country, more people than ever before are trying their hand at it. This new wave of gamblers has taken sportsbooks by storm and led to large gambling revenue numbers being posted across the board.
Many of these gamblers taking up sports betting for the first time have no previous experience. This can lead to many beginner mistakes — the largest of them being a lack of a bankroll management system.
Bankroll management is one of, if not the, most important thing to take care of when gambling on sports. It involves how you size your bets and how you determine how much to wager on each contest.
Many novice gamblers often think that they can succeed without a bankroll management system. Instead, they decide to bet based on their intuition and feel for the upcoming game. This is not a bankroll management system and will most likely lead to large losses, eventually consuming your entire bankroll.
In this guide, we will lay out some of the most common bankroll management systems that people use. Everyone is different and bankroll management systems are not one-size-fits-all. We will also explain why it’s important to have a system in place as well as everything you need to know about altering your system as you go along.
Practicing good bankroll management
The importance of a bankroll management strategy cannot be overstated when it comes to sports gambling. Without one, you are much more prone to losing your money quickly, as you will not be consistent with your bet sizing.
If you decide not to use a bankroll management system it will eat into your profits considerably. You could be a strong gambler who wins most of your wagers, yet not make a profit due to a lack of a bankroll management system.
Overall, it’s important that if you want to be profitable, or even if you’re just trying to make your gambling experience last as long as possible, you should 100% have a system in place. Just having the system put in place is not enough, as you also need to make sure to follow it no matter how your bets are going.
Thus, it takes discipline to stick to a bankroll management system. This discipline is often the difference between a strong and poor gambler. In the end, this can be the breaking point between turning a profit and losing all your money.
Sports betting units explained
The first important concept to understand when it comes to bankroll management is bet units. Bet units are a system used by sports gamblers around the world and help to reduce confusion.
The problem with gambling is that people have bankrolls of various sizes. One person may have a bankroll of $10,000 and another may have a bankroll of $100. If each person were to tell you that they were betting $50 on a game, that would imply a small bet for one and a very large bet for the other.
This means that it’s difficult to determine bet confidence from hearing bet sizes in dollars. Instead, gamblers have developed bet units, which are your typical bet size — one unit would equal whatever you usually put on a game. Let’s figure out how to calculate a unit.
Overall bankroll size
The first factor in bet units is your overall bankroll size. You’re going to want to set aside a dedicated amount of money just for sports gambling. This is known as your bankroll. You shouldn’t take money from outside of your bankroll for gambling purposes.
It’s important to know your overall bank size to set your unit size, as your unit size will be a percentage of your bankroll. Everyone has slightly different preferences on the exact percentage, so read on to find out what you should do.
Setting a unit size
When it’s time to set a unit size, you need to decide your risk tolerance. If you want to be on the riskier side of things then you would set it as a larger percentage, but this means that if you have a cold streak you can lose your money quicker.
Typically, it’s recommended that you set your bet units as 1% of your total bankroll. This way you can make solid gains without the risk that you will lose your money quickly.
Understanding unit sizing
Just because you have set your units at 1-3% of your bankroll, does not mean that you cannot wager more than that on one contest. As we will explore in the next section, there are a variety of different strategies that can govern your bet sizing when gambling on games.
Simple money management systems for sports bettors
Listed below are four of the most common bankroll management systems in sports betting. These all offer their own set of unique pros and cons and you should try them until you find one that works for you. Remember that no system is good unless you follow it, so make sure to have discipline when attempting these different systems.
Fixed Unit system
This is the easiest system to understand and execute. The fixed unit system simply means that you never alter the number of units that you place on any game. Therefore, for every game you want to wager on, you place one unit.
This can be good for people who are new to gambling or people who struggle with their impulses, as it’s easy to follow and won’t allow for any large losing streaks. One con is that it doesn’t adjust for anything; thus, if you are more confident in a selection, it won’t be reflected in your bet sizing.
Next up is the percentage system. The percentage system relies on you adjusting your unit size after every single game. This can be good because if you go on a winning streak then your bet sizes will increase and if you go on a losing streak then they will decrease.
For example, you could use a percentage system based on gambling 1% of your bankroll. If you had $1000 and then won a bet and your new bankroll was $1010, your new unit size would be $10.10.
Potential Return system
The potential return system works by examining the odds of the contest that you are betting on and then betting accordingly. This is usually done by creating confidence bands where your unit size will depend on which band your wager falls into.
As an example, you may wager one unit on anything +100 or below, or 0.5 units for selections in between +100 and +500 and 0.25 units for anything with odds above +500.
Last but not least is the confidence system. This system is a little more advanced and takes a little bit more work but can be worth it. The most popular confidence systems work using the Kelly Criterion Model.
Find your potential win in decimals, then multiply that by your confidence percentage in the wager and then subtract the potential loss percentage. Divide that number by the decimal of your potential win and you will be returned a number that is the percentage of your bankroll you should be gambling.
This is how you find out your unit sizing when using a confidence system.
Importance of tracking your bets
Another good habit to get into for any gambler is the habit of tracking your bets. You should be keeping detailed records about every bet that you make so that you can examine your performance. This has many different benefits.
The first is that you can see your overall performance and determine if you’re making money or not. Going beyond that, you can see which sports and bet types you perform best on. By finding out your best bet types and most profitable sports you can focus on finding more of those opportunities.
This will help you zero in on your approach to gambling and become a more profitable sports bettor. Instead of wagering on many different sports and many different bet types, it’s a better idea to be a specialist who is effective at doing a few of those things.
Overall, tracking your bets doesn’t take too much effort and can be very rewarding. It’s a good habit for gamblers to keep up.
Resetting unit sizes after withdrawals
During your gambling journey, you are going to make withdrawals from your account as you collect your winnings. It’s important to remember that when you withdraw from your account, you should reset your unit sizes to reflect the new reality of your bankroll.
It’s important to not include any money you have withdrawn when calculating your bankroll. That money can no longer be considered part of your bankroll and thus must be treated accordingly.
If you do withdraw from your online sportsbook account, then you probably have confidence in your abilities. This leads people to keep the same unit size they had before the withdrawal or even throw their bankroll management system out the window.
This all relates to having discipline and confidence in your system and bet sizing. You should have confidence that you can go to a new unit size that reflects the changes in your bankroll and experience the same confidence that helped you earn the winnings that you withdrew in the first place.
Discipline and sticking to your bankroll management rules
To hammer it in one last time, the importance of sticking to your bankroll management rules cannot be overstated. You could be an amazing gambler who is winning a large majority of your bets and wagers, but if you do not stick to a strong bankroll management system, you’re going to end up with nothing to show for it.
Chasing losses is a common issue for beginner gamblers, i.e.: the act of trying to make up for lost bets by using larger bet sizes. This is one of the worst mistakes you can make, but one that is easily avoidable by just sticking to a bankroll management system.
You’re going to have a much better time gambling if you pick one of the four systems listed above and stick to those rules diligently. If you find yourself struggling to stick to one of those systems, try another one. You may be more suited for a slightly different system and all four have their unique pros and cons and may appeal to different people.
If you want your gambling experience to take off and see some profits, you should find a system that works for you and stick to it through thick and thin.
Hopefully, this guide has helped you understand what a bankroll management system is and allowed you to find one that works for you. The most important ideas to take away from everything mentioned above are the concept of bet units, the different systems mentioned, and the importance of sticking to your system.
Considering that maximizing profit is the ultimate goal for most gamblers, a bankroll management system must play a key role in any gambler’s strategy. This does not have to be a chore; if you want a simpler strategy, many fit that description.
More important than the strategy you select is the ability to stick to it. When things are going poorly you might find it difficult to continue to bet smaller amounts, especially if you feel like you just need that big win.
This is why discipline has always been one of the most valued traits in gamblers and a good indicator of how successful your gambling experience will be. Set a plan and then stick to it, adjusting as you go along to fit your needs. This is the best way to make a profit while sports gambling, despite being a lesson that takes some people a long time to learn.