Kelly Criterion Calculator
Find the mathematically optimal bet size that maximizes long-term capital growth while managing risk.
Kelly Criterion Calculator
Full Kelly
$2,000
20.0%
Half Kelly
$1,000
10.0%
Quarter Kelly
$500
5.0%
Expected Growth Rate by Bet Size
Kelly Formula
f* = (bp - q) / b = (1.0 x 0.60 - 0.40) / 1.0 = 20.0%
Edge
+20.0%
How the Kelly Criterion works
The Kelly Criterion, developed by John Kelly at Bell Labs in 1956, provides a formula for the optimal fraction of your bankroll to risk on each bet. It maximizes the expected logarithmic growth of wealth -- meaning it finds the sweet spot between betting too much (risking ruin) and too little (leaving growth on the table).
In practice, most traders and bettors use half-Kelly or quarter-Kelly to reduce variance at the cost of slightly slower growth. This is especially important when your estimates of win probability might be inaccurate.