In probability theory, the Kelly criterion, or Kelly strategy or Kelly formula, or Kelly bet, is a formula used to determine the optimal size of a series of bets. In most gambling scenarios, and some investing scenarios under some simplifying assumptions, the Kelly strategy will do better than any essentially different strategy in the long run. The Kelly Criterion was first published in 1956. It is designed to be used in any gambling situation in which you have a positive expectation. When playing HUSNG poker the question asked by a lot of aspiring players is "How much of my bankroll can I bet on any given positive expectation outcome event without risking going broke!"
In the following article using a calculator that I have specifically designed for HUSNG poker players I hope to outline some possible ways in which the Kelly criterion can be utilised to help you ascertain what buyin level you should be at in a HUSNG match.
Step 1. Calculate your ROI
If you know what your ROI is already go to step 2.
If you don't but you know your winrate you can calculate it below. You also need to input the amount of Rake you pay.
Convert Winrate to ROI
Step 2. Calculate your Buyin level.
The theory about applying the Kelly Criterion to Poker is that your chances of going broke are small so long as you maintain the discipline to move down levels after losing a couple of HUSNGs.For some however the bankroll used for each buy-in level is uncomfortable, there is a perception of risking too much of your roll at any one point. If you feel like this the you have the option below to use half-kelly or quarter-kelly. These basically double and quadruple the bankroll requirement and carry proportionally less risk at each stage.