Mar 21, 2017

How to manage a dynamic bankroll properly

You've surely heard many times about new or advanced blackjack card counters. But there is still confusion about their finances. Some of these players have absolutely no idea about their bankroll.

They will make a few overbets and lose all their money. On the other hand, some people are really underbetting by much.

Please, keep in mind that if you have any misconceptions in this respect, you will never be able to achieve high winnings, either, and you will not be in black numbers against the casino in the long run. We think there is a very rational way to recognize an underbid safely. Everyone has a self-preservation instinct which reinforces this idea. Sometimes, however, this instinct fails during the game, which is when you have to take over and keep your restraints.

It is very important to distinguish the sensible reasons for underbetting from nonsensical ones. So now you can really get rolling and finally increase your bankroll.

Don't be ashamed about low bets

By the way, there is nothing wrong with being a low-roller and betting at the lowest limits. You should start with these low stakes. But there is nothing wrong with making the highest bets, either. And with the right knowledge, you can make a very good profit.

Perhaps the most important thing to have is a sense of bankroll from the point of limiting risk/returns. You could allocate the red chips for one day, green for the second and black for the third. Such game will give you lower returns and a higher risk than betting only using green chips.

But that's exactly the same situation as with regular players. They start from small bets, move on to bigger ones and so on. The alternative is to bet with only red or black. So what's better?

Beginners will instinctively suspect that it will not bring any profit. And right here's where instincts can be right. Beginners are very prone to selecting a wrong game and too many other issues. In addition, they must learn to curtail their emotional fluctuations. You might think you're now playing too high a game. But you may just be tested by software and watched by leading online gambling experts.

Everyone was a beginner once

Let's assume that you're a beginner. Consider that you play for 50 hours and lose 0.5%. This is equal to the house edge of our gambling game. If you already know the software, we can pretend that you only play for 25 hours and you have a smaller loss. So add these values to your values and estimate the benefit of the game. In any case, you should not estimate your result higher than the estimated value.

Let's take a simple example. As a beginner, you should play free games until you have a perfect command of the game strategy. Simulations show that the estimated value per hour is 2 credits when betting 2 credits per game with a standard deviation of 30 units per game (per 100 games per hour). In that case, you would raise the value of green chips minimally until you have won.

In your first 50 hours of play, you can actually increase your bankroll by 1 credit per hour. But do not forget that you also have to add the average loss per hour, which is 0.5% or perhaps even 1 unit. So your predicted value estimate is 0.

You can then hit a winning series within 50 hours and earn an average of 2 units per hour in the first 100 hours, which equals to +200 units. Taking into account the fictional 50 hours, your results are equivalent to 150 hours with a win of 150 units, i.e. a unit per hour.

The longer you play, the more you win

In the next 250 hours, you'll hit a winning series with a win of 750 units per hour. But that's just plain luck. In the real world, you will then earn a total of 950 units in 350 hours. You should, however, actually only win 700 units (2 units/hour). As you can see, your 50 hours do not matter much in this respect, but at 400 you will win 650 units which means 1.625 units per hour.

Let's sum it up:

  • After 50 hours of gameplay with small winnings, the house edge is 0.
  • After 100 hours of gameplay winning 2 units/hour, your earnings are 1 unit/hour.
  • After 300 hours of gameplay and a winning series, your average hourly earnings are 1.625 units.

Your expected edge should not fall below 2 units per hour.

Bet according to your financial possibilities

Your bankroll depends on your financial options and aversion to risk. It should be about a quarter of your money reserved for fun. So if you have $100, play only with $25. Your blackjack unit, i.e. strike, is equal to bankroll x estimated value/deviation. The deviation is standard deviation squared as estimated by the simulation.

Here are the consequences of your betting career. Take 1-6 "units" for blackjack for a good double deck game and 1-10 for worse versions.

  • After 50 hours of modest wins, you should still be betting minimum bets.
  • After 100 hours of decent results, your bets should be $28. Now, switch to the green chips quickly.
  • After 350 hours of winnings, your betting unit should be $45. Switch from green to black.

Your bets should not exceed $56 unless you're richer.

This betting system prevents overbetting. Indeed, the estimated edge is positive only if you earn 50 units. Raise your bets only when you're winning. Initial losses will thus prevent you from raising bets. But eventually, even with this system, you'll get bets with black chips if you have enough capital.

If you're winning 2 units per hour with $45 units, you will earn $90 per hour of gameplay. In this case, after several hundreds of hours of gameplay, you will earn an interesting amount of money. This additional bankroll will support your higher bets and ultimately make you a high-roller.

Comments (0)
Add a comment

You have to be logged in to add a comment