| Money Management applies the superior investing | | | | This, despite the 2 bettors wagering on the same |
| principle of wagering a percentage of available capital | | | | cards as they were turned up one by one. |
| rather than a constant flat dollar amount. In Sports | | | | What Happened?! |
| Handicapping And Money Management - Part 1, we | | | | What the 50% bankroll bettor (and the average fan |
| examined "Flat Sports Gambling Systems" and | | | | gambling on sports) failed to understand is that for the |
| demonstrated its shortcomings. Percentage Sports | | | | greatest return on any series of wagering opportunities |
| Gambling Systems are the preferred method for | | | | there is a precise percentage of bankroll that should |
| professional sports handicappers and investors, which | | | | be risked. Even with more winners than losers, betting |
| is the subject of this article. | | | | considerably more than the "magic number" will |
| Some "pros" try to combine the opposing theories by | | | | ultimately result in a net loss. PRO INFO SPORTS has |
| advising that a flat amount determined by a set | | | | named this ideal figure the "PEAK PROFIT |
| percentage of a starting bankroll be wagered on | | | | PERCENTAGE" or "PPP". The sequence of winners |
| games until the total funds are increased or decreased | | | | and losers in the card game or even in sporting events |
| to a degree (50%, for example), at which point the flat | | | | have no bearing whatsoever on the results of the |
| amount is recalculated from the set percentage of the | | | | application of the PPP principle. Using the same |
| new bankroll amount. | | | | percentages, the outcome will be the same every |
| This is only a slight improvement on the | | | | time, regardless of win-loss pattern. |
| aforementioned pure flat sports gambling system plan | | | | This Peak Profit Percentage is determined by the |
| since, after the first wager is either won or lost in such | | | | expected winning percentage for a series of wagering |
| a scenario, the distinct advantage of percentage | | | | events. In the card game model, the anticipated winning |
| betting is lost. The inherent flaw of flat betting | | | | percentage for 52 bets is 61.5% which has a |
| (increasingly higher-percentage wagers the more | | | | corresponding PPP of 23%. Any percent of bankroll |
| money lost, and increasingly lower-percentage wagers | | | | wagered less or more than 23% in such a scenario will |
| the more money won) is then forced into effect. The | | | | not be as profitable, and gains are eventually turned |
| illogical disparity only increases until the static | | | | into losses if the PPP is exceeded too greatly. This is |
| percentage is finally recalculated from the new bankroll | | | | why the card game's 25% player enjoyed a 400%+ |
| and not the one of days, weeks, or even months ago. | | | | ROI (Return On Investment), while the 50% bettor |
| Since percentage wagering is clearly superior to flat | | | | suffered a -50%+ ROI. |
| sports gambling systems, it is most financially favorable | | | | The Peak Profit Percentage concept can be a difficult |
| to reconcile the fixed percentage of bankroll before | | | | one to comprehend but the numbers do not lie. All |
| each wager to avoid the mistaken use of a flat betting | | | | professional investors (stocks, bonds, sports wagering, |
| scheme for any number of games. | | | | etc.) should be mindful of this numerical phenomenon |
| Having established the superiority of percentage | | | | and use it to their profitable advantage. |
| wagering over any type of flat sports gambling | | | | Since the Peak Profit Percentage is determined by |
| system, the consideration becomes one of determining | | | | anticipated winning percentage, having a realistic |
| what percentage is ideal and whether it ever varies | | | | expectation in sports wagering is imperative. Those |
| from game to game. | | | | "scamdicappers" claiming long-term winning opinions of |
| Many percentage bettors incorrectly presume that a | | | | 67% or better should not be relied upon for sports |
| winning percentage above 52.5% (the break even | | | | handicapping or investment advice. Of course, these |
| point due to the 10% sportsbook "vigorish") will | | | | self-proclaimed experts would never suggest a |
| ultimately return a profit regardless of what bankroll | | | | gamble of anything near 28% of a bankroll on one of |
| percentage is invested, as long as it is consistently and | | | | their "superlocks" or "games of the year", yet 28% is |
| continually applied, and that with a better-than-52.5% | | | | indeed the PPP for a 67% winning expectation. Is it |
| winning percentage an increasingly higher percentage | | | | plausible for these touts to be brilliant, |
| of bankroll wagered will produce increasingly larger | | | | borderline-psychic when it comes to handicapping |
| profits. The potential financial pitfalls of this | | | | sports but completely devoid of basic money |
| misconception can be illustrated by the following | | | | management awareness? We find it much more likely |
| hypothetical gaming example: | | | | that their true winning percentage is much, much lower |
| PICK YOUR PERCENTAGE | | | | than advertised. |
| Two friends enter a casino and are intrigued by a new | | | | We are confident that we will to continue to offer our |
| card game called "Pick Your Percentage". The game | | | | clients a winning expectation of 55%-60%. Looking at |
| features a dealer taking a single deck of cards and | | | | the figures within that range, a Peak Profit Percentage |
| turning the cards face-up, one at a time, while the | | | | of 5% can be calculated from the low end (55% |
| players wager on each card. | | | | winners) and a PPP of 15% at the high end (60% |
| To play, each bettor simply has to declare a starting | | | | winners). Taking the riskiest position with a $1000 |
| bankroll and what constant percentage of his bankroll | | | | bankroll (wagering 15% per game) would actually result |
| will be wagered on each card. All 10's, face cards, and | | | | in a net loss of $348 after 100 events if the winning |
| aces are winners for the house while the cards | | | | percentage actually turned out to be at the low end of |
| numbered 2-9 are winners for the players; thus, out of | | | | 55%. A sports investor should never be penalized for |
| 52 betting opportunities the players would be | | | | "only" producing 55% winners. On the other hand, |
| guaranteed 32 winners against only 20 losers for a | | | | taking the most conservative position (5% wagers) |
| 61.5% winning percentage. | | | | with a $1000 bankroll will show a profit after 100 |
| The gentlemen sit down at the table to play through a | | | | games, ranging from $148 (with 55% winners) to $944 |
| deck. The first man declares a starting bankroll of | | | | (60% winners), so we find that there is no overall |
| $1000 and a wager of 25% of bankroll per card. The | | | | advantage of risking more than 5% of current bankroll |
| second bettor also declares a starting bankroll of | | | | on even the strongest of our expert sports picks and |
| $1000 but states he will risk 50% of his bankroll on | | | | selections. |
| each card, assuming he will at least double his friend's | | | | Applying the same investment principles to our |
| winnings. | | | | remaining sports picks which have a slightly lower (but |
| After the dealer is finished going through the deck, the | | | | still profitable) winning expectation, we have a Money |
| bettor risking 25% of his bankroll on each card has | | | | Play STAR SELECTION RATING SYSTEM with |
| quadrupled his original bankroll and ends the game with | | | | corresponding PPPs, which we'll cover in detail for our |
| over $4000. The bettor risking 50% of his bankroll on | | | | next article - Sports Handicapping And Money |
| each card has lost more than half of his original $1000 | | | | Management - Part 3. |
| bankroll and ends the game with a little over $400. | | | | |