Kelly and Bankroll - why?

I read a lot about AP blackjack, and I consider myself an accomplished amateur. I play a 1-9 spread at low-limit tables. I track every session as to win/loss and time. Over four years, I have a positive balance. I have experienced both the peaks and valleys that this experience offers, and I don't expect either extreme to stop happening. As good as I am at it, I don't think I'm going to get much better, and even if I do, that won't do anything to even out the ride - that's the variance that's built into the roller coaster.

So should Kelly, Bankroll and ROR matter to me?

I sit down, start counting, win a little, lose a little, sometimes win more, sometimes lose more. I read about these terms, but I don't know how to apply them to my specific situation. I think my spread is "Kelly-cized", since I bet table minimum (1 unit) @ TC < +1, 2 units @ +1, 4 units @ +2, 7 units at +3, 9 units @ >= +4.

OK, so tweak my spread to make it closer to "True Kelly", whatever that is. At some point it's dialed in to the ideal.

What else do I need to worry about? I'm not tapping the Nest Egg to finance this endeavor. I'm not making an investment in a business that needs to make so many widgets to turn a profit. I take 30 units out of my pocket, get some chips, and let the game begin. I'll take another 30 units out if I need to. That's the limit I set myself for one session, but whatever the outcome - lather and repeat, a couple of times a week.

It works. I'm ahead over time. I eat and drink for free. Get occasional concert tickets. Experience absolutely no heat, I enjoy it. It's not a job. I have one of those, and this is loads more fun.

Are worrying about Kelly, Bankroll and ROR only important if you do this for a living? From my experience, the only difference between the professional and me is that the unit is much larger in real dollars, the time spent working is a lot more than what I put in, and as a result the Bankroll may well eat into the Nest Egg and ROR is a real possibility. But why should I worry about them?

I am not very knowledgable on the subject as well, but based on what I've read, you need to worry about not betting more than Kelly. Betting lower than Kelly is will just lower your ROR and your profit.
Kelly is optimal for bankroll growth, and some APs who don't know about it and are too eager to make more profit will overbet, thus increasing their ROR a lot. It doesn't seem like you are doing that so I wouldn't worry.

100 people here are more knowledgeable than me with this, but you should use the Kelly Criterion to establish your average bet size/spread. Otherwise, if your average bet is too high for your bankroll, there's a 100% chance of going bust eventually.

https://wizardofvegas.com/articles/A-to-Z-Counting-Cards-in-Blackjack/

Hey racquet.

While on the face it might seem like most would snuff you question with "of course you need to know it!" but in your particular experience/situation I think you raise a good question. However, after some thought, I think the answer will still be all the same =).

You definitely have to know about these things. The reason they haven't affected you too much is that your spread is a bit smaller, which shows that you're under the "danger zone" of kelly betting (anything over 2x kelly is a mathematical guarantee to reach bust at some point). So if you didn't know about Kelly, Bankroll, and RoR and you had a 1-100 spread... you could have a PERFECT game and still come up a loser because of these concepts. So you inadvertently protected yourself "enough" by having a small spread. Optimizing your spread for YOUR specific bankroll means say your 1-9 spread is making you $5/hour as of now. Well, had you optimized it with kelly betting for your bankroll and RoR requirements, you could have made $10 or $15 per hour. So now you've played for 4 years, right? Well, you could have doubled or tripled your profit in that time frame.

Essentially by ignoring Kelly/Bankroll/RoR you're being wildy inefficient. Either you bet to high and you'll go bust, or you'll bet too low and then you're wasting time at the tables. I like to think of it as hours worked. Say you spend 10 hours at the table earning $5 per hour... At the end of your 10 hours you made $50. Say I have the same skill level as you, but I optimize my betting with kelly/bankroll/RoR... and I make $15/hour because of it. Well, after 10 hours I make $150. The difference in money is obvious, but what I like to consider is the difference in WORK. It will take you 3x the hours of physically playing to reach the same EV that it took me to reach. So you have to work 3x as hard as me, just for not understanding these other concepts... and again, if someone else didn't understand them and over-bet, then their result would even be to BUST... but I'm looking at your situation from what information you have given... You're doing a lot of unnecessary work by avoiding the small amount of work it takes to understand these concepts and include them in your game.

So you're positive over 4 years... but you've essentially done 8-12 years worth of work of someone else at the same skill level with a better understanding of these other factors. Lotta time wasted at the tables =).

TLDR if you aren't worried about losing whatever money you've set aside for counting cards, then it doesn't really matter. If you are a professional or treat it like a professional, then you need to know about things like ROR, kelly, etc. so that you have a minimal chance of going broke. A professional AP needs money to make money. Someone who is not a professional doesn't need money to make money, because they already have a job.

Do what you want. Of course, that goes without saying.


But in my opinion, you should still learn about kelly, ROR, and the math behind card counting. Maybe one day you'll have a large investment in it and you'd like to know how to maximize your earnings while minimizing your risk....or you'll like it a lot and want to do it professionally. I've always enjoyed math and think it's interesting, so it'd be easier for me to read about something I don't need to know than for many others.


What's your goal as a player? If all you want to do is spread $5 to $50 (or whatever you do), get some free food, rooms, shows, whatever else, then you probably don't need to learn about that stuff. If you want to treat it like a hobby where you can make some extra money, then you may want to learn about it. If you treat it like a serious hobby where you can make some serious money or at least a side income, then you should absolutely learn this stuff.

I guess what I'm trying to say is that other than modifying my spread, what else can I do? I'm not in Las Vegas, so I cannot scout out different casinos, games and rules, vary my playing times and/or apply whatever cover is needed to improve my return. Since I play where there are very few low-limit games, I'm stuck with whatever hands-per-hour I find when I get there, dependent on the speed of the dealer and the number of other players at the table. Penetration is what I think is the most important piece of the puzzle, so I try as best I can to scout out the dealers who I see give me the best chance. Generally, it sucks (never worse than 66%, usually a little better). I don't have a lot of options, including that if I do get flat-bet, I'm done for. There are not a lot of convenient places to play.

I've taken the tables I see in Wong's Professional Blackjack for decks with different shuffle points, and combined with a spreadsheet in Rome's outstanding series of articles, I have what I think is a spreadsheet that gives me an accurate Gain-per hour. I tweak it with a variety of spreads to see what happens when I manipulate my spread.

I have trouble figuring out what "Kelly score" these variations earn. I can see my rate of return increase as I increase the slope of my betting spread. But I'm sure that just increasing how quickly I up my bet as the TC increases is not the whole picture.

Does a steeper ramp-up have an inherent worse Kelly, and therefore a greater ROR? Does the required bankroll increase because with a greater possible return there is also a wider swing in fortune, so be prepared to weather the bad times by having more money available?

With Wizard's calculators, I can plug in the myriad rules of any game in the world and he'll tell me the unique BS for that game. No guarantees, but I trust what he tells me, and have no idea how the mathematical formulas work.

Is there no such calculator for Kelly?