Everything you need to best manage your betting bankroll
Many esports fans have been reluctant to get into betting due to the fear of losing money. Although there are risks to betting, they can be minimized with proper betting bankroll management. In fact, if financials are properly managed, betting is not only fun, it can even become profitable for skilled and attentive bettors.
Betting isn’t simply about picking the team with better odds. It’s a game of its own, one that requires lots of strategy.
Yes, there has to be some readiness to take risk and accept a few losses along the way. But risks must be properly managed and mitigated. Before one starts betting, they need to set an a solid financial amount, a budget that they can freely work with and that they feel comfortable spending.
How to decide on a betting budget
How much money one can use in esports betting depends on one's own personal finances, as well as what other responsibilities and leisures that require spending. The best way to decide on a betting budget is to first consider your existing income and expenses, and to make sure that you're only using a comfortable amount to bet.
Most people budget for each month. Income is first filtered into required living expenses. Once that’s done, the rest of the money needs to be budgeted into things like food, games, subscriptions, and possibly betting. For a proper bankroll, priorities need to be set in place from the very beginning.
Once that’s done, it becomes clearer how much money can be spent on bets each month. Not everyone is ready to risk all of their money left after standard expenses on betting. Although betting can bring long-term profits, it’s important that a betting bankroll is composed only of the money a person is willing to lose without it impacting their day-to-day life and activities.
Deciding on a budget on a per-month basis in esports has more perks. Not every month is filled with top tier tournaments, while others might be overflowing with them. Having a budget to be used for betting over a month allows for a set distribution between favorite teams, tournaments, and games, without fear of spending too much when there are many events to choose from.
It's a good idea to keep track of all bets made. Not only will this allow fora planned distribution of your betting budget, it will also provide a great tracking opportunity on which bets are working the best for you, and which are just dead weight.
How to properly size your betting bankroll
Keeping the betting bankroll the same as time goes on isn’t necessarily the best way to go. While others might be turning all of their bets into profits, some could be losing it all. And these outcomes can, and likely should ,impact the size of one's bankroll.
This is where a list of bets made comes in handy. One can always take a look back and evaluate their past betting expenditures. If recent bets resulted in a loss, it may be best to decrease the size of the next budget. If the situation is more profitable, and there has been more money earned than lost, some of these winnings should be reinvested intp the upcoming budgeting period.
By doing this, one can ensure that losing streaks will be less painful on the wallet while at the same time better taking advantage of winning streaks.
A smaller budget also means smaller stakes, but a bigger one shouldn’t necessarily mean significantly higher stakes. At the end of the day, risking all one's winnings with significantly greater stakes won’t lead to consistent profits at the end of the month. There might be a short-term gain, but this is likely to be inconsistent.
The end goal of sizing and setting up the bankroll is to not be in a tight spot when all of your betting money is lost, and to get a stable return on the investment when the outcome from your bets goes right.
How to best use your money on esports betting
When a betting bankroll is set in place, a decision needs to be made on how to use this bankroll in a safe and smart way. In esports, just like with traditional sports betting, there are a few bankroll strategies that can work best depending on an individual’s preference for the variables they want to allow for in their bets. All of these strategies take one's betting bankroll into consideration, with some being targeted towards more experienced betters, and some towards those who are new to betting on esports.
Fixed unit strategy and percentage model
This is the best strategy for casual betters. Using it keeps the bankroll stable, as it doesn’t take into consideration the past failures or successes of similar bets, confidence, or even odds. Rather, it is a consistent approach for those who don’t initially feel as confident in their betting choices.
For the fixed unit strategy, a fixed percentage of the total bankroll needs to be set in place. Depending on how many bets one plans on placing, the usual unit size should be around 2% of the overall bankroll. And it's just that simple. If a bankroll is $1000, and each bet is valued as 2% of it, then not more than $20 should be used on a bet. Anything over that amount that is earned becomes profit.
The percentage model is quite similar, but takes previous outcomes into consideration. The bankroll doesn’t remain constant, but rather grows or shrinks over time, and the 2% from the fixed unit strategy then gets accounted into each new amount. If the bankroll amount is bigger, bets will be higher, and if it’s less, the wages will be smaller as well.
For those that spend a lot of their time watching their favorite teams compete and feel confident in predicting outcomes, there’s the confidence strategy. Judging a bet based on an individual's confidence can make one lose money a lot faster. But taking these risks can also yield higher returns.
When using this strategy, rather than having a fixed percentage for all the bets, bets one is more confident in will take a larger portion of the budget, while less confident bets will take less. If a bet is worth 3%, 2%, or 0.5% of the bankroll is decided based on one's confidence in each outcome being bet on. To make sure money isn’t lost so quickly, this strategy is better used if only one bet is set at a time. Placing multiple bets one is confident in at can result in a heavy and quick loss.
The Kelly criterion model should be set in place only once a person has a good understanding of the esports scene, the teams playing, and how odds work. This strategy takes all those variables into account, meaning that the risk is higher, but so is the return.
To decide on the amount that should be wagered for a bet, both the odds of winning and losing are taken into the calculation. The percentage of the bankroll that should be wagered is calculated as (% odds of return x probability of win - the probability of loss) / (odds of potential return). For ease of managing bankroll and providing more safety, the Kelly criterion should be used across shorter periods of time than a monthly budget, making this the most complex of the potential options available.
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