Martingale. The martingale staking strategy falls into the progressive staking plan category. The strategy was originally designed for a simple coin toss game, with a 50/50 chance of either outcome, where the gambler would double the stake after every losing bet and returning to the starting stake after a win. More...

 
 

Staking plans

Fundamental to any betting system is finding an edge. This could be through trading or arbing, but with most other systems the edge is finding value bets. Once this has been accomplished the next step is to maximise profits and this is where staking plans come in. If a system makes a level stakes profit choosing the correct staking plan will increase profit, but don’t fall into the trap of thinking a staking plan can turn a losing level staked system into a winning one.

A quick search on any internet search engine for staking plans will throw up many differently named strategies for staking and even software that claims to select the best of the popular strategies for you. But once you remove all the bells and whistles all these strategies brake down into four separate categories – level staking, variable staking, progressive staking and percentage staking.

Level staking is the simplest and therefore the most widely used of all staking plans. The only decision that needs to be made is how much the stake will be, and then simply bet every selection with that amount. This staking plan should be used for any system testing whether it be ‘paper trading’ or ‘back testing’ as it should form the yardstick on which all other staking plans should be judged.

Variable staking is a strategy that changes the value of each stake depending on certain criteria. This could be based on the odds, expected value or any number of different variables. The most common type is that based on odds, of which the favourite strategy is fixed profit betting where the stake varies in order to return the same profit. I.e. a 10 points bet would be placed on an events with evens odds where as a 1 point bet would be placed on a 10-1 shot. Both returning 10 points.

Progressive staking involves increasing or decreasing stake sizes after each bet, based on whether the selection wins or losses. This staking strategy is the main culprit for people trying to turn losing systems into winning one as the goal is to make every betting sequence a winning one by chasing losses. Although progressive staking strategies can show very healthy profits if used correctly this one’s not for novices or the faint hearted as long losing runs can quickly break the bank. Anyone using progressive staking should fully understand risk management and maybe employ a stop loss.

Finally, Percentage staking. A very risk averse strategy that theoretically means the betting bank never reaches zero. This strategy involves staking a set percentage of the betting bank on every selection meaning stake size will go up and down after each bet. If risk of bankruptcy has been properly accessed this strategy is more commonly used as a percentage of the betting bank at its highest point. Meaning stake size goes up on winning runs but remains constant on losing runs.

The selection of a staking plan is entirely dependent on your attitude to risk taking but if your system makes a profit using a staking plan but a loss at level stakes don’t fool yourself into thinking this is the strategy for you. At this point the best strategy is to either re-evaluate your system or gather a greater data set to test with.

   
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