Serious
Sports Bettors Money Management
by John Rayzohr
For
those of you who have decided that you'd prefer to be
"Sports Investors" as opposed to recreational
bettors, there are some simple hard truths you'll have
to look at when thinking about money management.
First,
to get some rudimentary things out of the way, if you
want to be a professional sports bettor, or someone who
derives a serious living or second income from sports
gaming you have to give up some of the "thrill"
of betting in favor of the dull reality that betting as
investment is work and it doesn't involve some of the
fun stuff associated with recreational gaming like prop
bets, parlays, teasers and reverses. You don't get to
waste a few bucks from your bankroll to play the Lakers
playoff game if your general niche or specialty is the
NFL. No more betting coin tosses or doubling up the action
on the late game after a bad morning. In short, more important
than money management is personal responsibility and discipline.
Because regardless what advice I give you, if you refuse
to put it into action, and you continually place sucker
bets and make foolish decisions, no amount of advice will
be of any help.
With
that banter out of the way, here's a quick and dirty synopsis
of my money management strategy:
1.
Know your bankroll
2. Know your personal finances
3. Keep the two entirely seperate
4. Flat bet all the time and every time (never more than
2% of your bankroll)
5. Don't readjust your bankroll until you are "significantly"
up or down, and once you have established a consistent
winning pattern over multiple years, never adjust downward
So
with the above I likely have alienated half of those reading
here as many of you are likely adherents to the Kelly
Criterion, or some star system, or power numbers that
dictate betting more here and less there or nothing at
all at times. If you choose to use a system such as that,
by all means it is your choice, but frankly, over the
long run, you'll end up in a much worse place than if
you just flat bet each and every bet. (I could offer a
good deal more on this topic but in the context of this
article it isn't necessary, for a more thorough write
up, see JR Miller's Debunking
the Kelly Criterion at his site.)
So,
lets talk about the five little items I delineated above
and what they mean:
1
and 2 and 3
Don't bet with your rent money, don't pay your
rent with your betting bankroll. If you are approaching
sports gaming as an investment, you need to be disciplined
enough to keep your monies wholly seperate. You cannot
rob Peter to pay Paul and you have to avoid the tendency
to borrow money from one of your accounts to take care
of the obligations of the other. If you are doing this
as a business, you have to have adequate capital to do
so, and you have to be disciplined about your money.
Four
Once you have decided your bankroll (say 10,000
for instance) decide the base bet you will make week in
and week out (1% = 100, 2% = $200) and stick to it for
every game you play.
Five
Winning and losing are long term propositions,
and for this reason you should not be too hasty to readjust
your betting numbers. If you make a solid month of bets
and your overall bankroll climbs up to $11,000 from the
initial 10K, I don't recommend starting to place $110
wagers. I typically wait for a swing of at least 20% before
adjusting or recalculating my bets.
The
second part of this maxim is likely the most controversial
in the collection, but here are my thoughts. If you have
established that over the course of four or five NFL (or
CFB, or NBA, etc...) seasons you hit 55-60% of your bets
and you know you have the bankroll to ride out a short
term losing streak, I believe it is better to never readjust
downward. In simple terms, if you lose 10 bets of $200
betting 2% of your bankroll and you now sit at 8K, and
you now lower your bets to $160 each, you need to win
12.5 bets to get back to "even." Though you
may wish to adjust both up and down as you learn your
overall tolerance, handicapping ability, and overall success
rate, once you have set a "barometer" for your
success over several seasons I recommend never adjusting
down.
