Kelly Criterion Calculator
Calculate the mathematically optimal bet size to maximize long-term wealth without risking bankruptcy.
Real-time Results
Percentage of your total bankroll to risk
Expected profit per $100 wagered over the long run
Risk Analysis
Breakdown of your edge and Kelly fractions
| Item | Value |
|---|---|
| Full Kelly % Mathematically optimal, but extremely volatile | 10.00% |
| Half-Kelly (0.5) % Highly recommended for most investors (less variance) | 5.00% |
| Recommendation Favorable bet. Follow the calculated percentage of your bankroll. | Bet |
Disclaimer
The calculation results of this financial tool are for estimation and research reference only and do not constitute any investment advice or commitment. Actual rates and yields are subject to the final contract with the financial institution.
Why Choose Kelly Criterion Calculator
The Kelly Criterion Calculator is a powerful risk management tool for investors, day traders, and sports bettors. Based on a mathematical formula developed by John L. Kelly Jr., it calculates the exact percentage of your bankroll you should wager on a bet with a positive expected value. By using the Kelly Criterion, you maximize the compounding growth rate of your wealth while virtually eliminating the mathematical possibility of absolute bankruptcy.
- ✓Determine the mathematically perfect position size for any trade
- ✓Avoid catastrophic losses by scaling bets according to your exact edge
- ✓Support for 'Fractional Kelly' (e.g., Half-Kelly) to significantly reduce volatility
How to Calculate
- 1Enter the probability of winning the trade or bet (e.g., 55%).
- 2Enter the payout ratio. If you risk $100 to make $200 profit, enter 2.
- 3Optionally set a Fractional Kelly multiplier (0.5 is highly recommended).
- 4The calculator will output the exact percentage of your bankroll to allocate.
Frequently Asked Questions (FAQ)
What happens if I bet MORE than the Kelly percentage?
Betting more than the Kelly fraction is a mathematical disaster. It increases your volatility immensely while actually DECREASING your long-term compound growth rate.
Why does everyone recommend Half-Kelly (0.5)?
Human beings overestimate their 'edge'. If you think you have a 60% chance to win, but you actually only have a 52% chance, betting Full Kelly will cause massive drawdowns. A Half-Kelly multiplier gives you 75% of the optimal growth rate but drastically reduces the volatility.
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