Bankroll, units, staking plan... But What Does It All Mean?
You may have read a lot of people talking about bankrolls and units of stake which initially can seem confusing and trying to over engineer betting. If you intend to become successful and profitable with your betting then it is imperative that you understand the importance of bankroll management and a staking plan.
Your bankroll is a pot that you are dedicating to your betting, and in particular to following a certain service or tipster. Personally, I start each month with a £1,000 bankroll which is split across 4 or 5 bookmaker accounts. If I end the month with £1,500 in my accounts I withdraw the £500 profit and start the following month with £1,000 again. That £1,000 is my bankroll.
The bankroll is then split up in to 100 units, each representing 1% of your bankroll. So in my case 1 unit is £10 i.e. 1% of £1,000 bankroll.
Each bet that I tip will have an advised stake on a 1-5 unit scale. That means that the maximum we would ever stake on a bet is 5% of our bankroll. Most bets are 3 units which represents 3% of our bankroll.
Having a £1,000 bankroll does not mean we ever believe that we will lose £1,000. It is a buffer and an insurance for the month. If we lose 15 units then we still have 85 units remaining. That means we don’t have to reduce our stakes and we don’t get nervous about carrying on with the bets. If we reduce our stakes after a few losses then we won’t get the benefit of the winning bets that will follow. The golden rule is that we don’t increase stakes after a winning run through over confidence, or drop stakes after a losing run. Level stakes all month long.
It is important to note that bet size is primarily driven by the perceived value that I see in the odds. For example, let’s imagine we are betting on the toss of a coin. The odds of the coin landing on heads are 50% and so the odds should be 2.00 (evens). If a bookie is offering us odds of 2.10 then there is value and we will take the bet. Let’s assume we flip the coin just once and it lands on tails then we lose the bet and there are some that will say it was a bad bet because we lost. In this instance we lose 1 unit. However, betting is based on volume, so now imagine that we flip the coin 1,000 times – we have to assume that the coin will land on heads 500 times. We win 500 bets and lose 500 bets. Based on 1u staked each time we will get 2.10 units returned on each winner. 500 winners x 2.10 units is 1050 units giving us 50 units profit because we took odds with genuine value.
Now imagine that for some reason a bookie is offering odds of 2.50 on a coin landing on heads. In this instance I will stake a higher amount to leverage the perceived value. Note that this is not because the odds are high, and it’s not because I think the coin will land on heads on this one flip – it is because of the great disparity in odds and actual chance.
Understanding when to take a bet is one of the hurdles to overcome in betting and explains why a lot of the time there should be no bet as the odds don’t offer true value. However, each bet that I post will be based on there being value in the odds, and this is what drives our long term profit.
Remember, it only takes a day to lose your entire bankroll if you start chasing losses or lose your disciplined approach to units betting. Do not under any circumstances chase your losses, accept them as part of the journey to long term profit. We work hard to generate monthly profit and you don’t want to throw it away through ill-disciplined betting.