Kelly Criterion Calculator. Enter your account balance, bookmaker odds, winning probability, and Kelly multiplier to find your optimal bet size. The Kelly Criterion Calculator returns the recommended fraction of bankroll to wager, the dollar amount to bet, and the expected value of the wager — helping you size bets for maximum long-term growth without risking ruin. Also try the Expected Winnings — Moneyline Odds.
The Kelly Criterion is a mathematical formula developed by John L. Kelly Jr. in 1956 that determines the optimal fraction of your bankroll to wager on a bet. It maximizes the expected logarithmic growth of wealth over time, balancing the desire for growth against the risk of ruin. See also our Parlay Calculator.
The formula is: Kelly % = (bp – q) / b, where b is the net decimal odds minus 1 (profit per unit wagered), p is the probability of winning, and q is the probability of losing (1 – p). The result is the fraction of your bankroll you should wager.
A negative Kelly value means you have no mathematical edge on the bet — the expected value is negative. In this case, the Kelly Criterion recommends not placing the bet at all, as it would erode your bankroll over time.
Fractional Kelly involves betting a fraction of the full Kelly amount, such as Half Kelly (50%) or Quarter Kelly (25%). While this reduces the mathematically optimal growth rate, it significantly lowers volatility and drawdowns, which is why most professional bettors and traders prefer it.
The Kelly Criterion was created by John L. Kelly Jr., a researcher at Bell Labs, and published in 1956 in the paper 'A New Interpretation of Information Rate.' It was later popularized in the gambling and investment world by figures like Edward Thorp.
Yes, the Kelly Criterion is widely used in financial trading to size positions. Traders input their historical win rate and risk/reward ratio as inputs. However, most professionals use Half Kelly or less due to the sensitivity of the formula to estimation errors in win probability.
Full Kelly maximizes long-term growth theoretically, but in practice your win probability estimate may be slightly off, which can lead to severe drawdowns. Using Half Kelly or Quarter Kelly captures most of the growth benefit while substantially reducing the risk of large losses.
This calculator uses decimal odds (e.g. 2.50). If your sportsbook shows American odds, convert them first: for positive odds (e.g. +150), decimal = (150/100) + 1 = 2.50; for negative odds (e.g. -200), decimal = (100/200) + 1 = 1.50.