Kelly criterion calculator
- Stake
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- Expected return per $1
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- Break-even probability
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- Growth per bet, your stake
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- Growth per bet, full Kelly
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- Growth per bet, 2× Kelly
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Example values. Change any field. Everything is calculated in your browser and nothing is sent anywhere.
The Kelly criterion stakes the share of your bankroll that maximises long-run growth: f* = p − (1 − p) ÷ b, where p is your win probability and b the net odds. At 55% on decimal odds of 2.10, full Kelly is 14.1% of bankroll. Many traders stake a quarter or half of that, because an over-estimated edge makes full Kelly swing hard.
How is the Kelly criterion calculated?
Kelly f* = p − (1 − p) ÷ b Betting odds: b = decimal odds − 1 Prediction market: b = (1 − price) ÷ price Trading: b = average win ÷ average loss, p = win rate Expected return per $1 = p × (b + 1) − 1
At 55% on decimal odds of 2.10, b = 1.10 and f* = 0.55 − 0.45 ÷ 1.10 = 14.1%. A Polymarket share at 62¢ that you put at 70% has b = 0.613 and f* = 21.1%. A strategy that wins 55% of trades with wins 1.5 times the size of its losses has f* = 25% of the account risked per trade.
Why most people bet a fraction of Kelly
Kelly assumes your probability is exactly right. It rarely is, and over-estimating your edge pushes you past the peak of the growth curve, where you take on more risk for less growth. At twice full Kelly the typical growth is about zero, and beyond that it turns negative.
Half Kelly keeps about three quarters of full Kelly's growth with far smaller swings, which is why half and quarter Kelly are common choices. The calculator shows the growth at your stake, at full Kelly and at twice Kelly so you can see the trade-off.
Kelly with several positions open
The formula is for one bet at a time. With several open positions, especially related ones like two markets on the same event, stakes that are each right alone can add up to far too much. Cap the total, not just each position.
How AI Trading Fleet sizes an order
Whatever size a strategy asks for, the risk check decides what it gets: the smallest of the requested size (scaled by the strategy's stage) and your caps per strategy, per venue, per position and per market. A strategy whose calibration is slipping trades at half size; one on paper or retired trades none.
Questions
What is the Kelly criterion?
A formula for the share of your bankroll to stake on a bet with an edge so that your bankroll grows fastest over many bets: p − (1 − p) ÷ b, with p your win probability and b the net odds.
Is full Kelly too aggressive?
Often, in practice. It assumes your probability is exact, and it produces large swings even then. Many traders use half or quarter Kelly. Nothing here is investment advice.
What does a negative Kelly number mean?
That the bet has no edge at that price: your probability is below the break-even probability. Kelly says not to bet.
How do I use the Kelly criterion for trading?
Use your win rate as p and your average win divided by your average loss as b. The result is the share of the account to risk per trade, meaning the loss if the stop is hit, not the position size.
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Trading involves risk of loss. Nothing here is investment advice. Read the risk disclosure.