Kelly Criterion: how it works and why most people should bet half

A formula for sizing bets to maximize long-run growth. The math is simple. The discipline it requires is not.

The Kelly Criterion is a formula for sizing bets to maximize long-run bankroll growth. The core calculation: Kelly fraction = (p × b − (1−p)) / b, where p is your estimated win probability and b is the net odds on a win (for −110, b ≈ 0.909). If your model gives a team 55% probability at −110 odds, Kelly recommends betting about 5.5% of your bankroll. That number represents the size that maximizes compound growth over many bets — assuming your probability estimate is accurate.