Money Management in Blackjack

Money management is just as important to the blackjack player as is the right choice of a blackjack variation or the use of a good strategy. Skills, knowledge and even the ability to count cards would be pointless without a good money management plan – what bankroll should one dedicate for a blackjack session, what the minimum and maximum bets should be, and more.

Similarly to roulette, slots, or any other type of a casino game, blackjack is a negative expectation game, which suggests that in the long term, players are more likely to lose than to win. This is predetermined by the house edge, the mathematical advantage of casinos over their patrons that is built in every single game. It comes as a result of the rules and payouts guaranteed to favor the house rather than the players.

In blackjack, the only way to overcome the house edge is to count cards but even good card counters will not win every single hand because blackjack remains, after all, a game of chance. Winning and losing depends not only on players’ decisions but also on the probabilities for each hand. With a good money management plan, however, players will be able to make the best of their strategy and chance or limit their losses when luck is not on their side.

What Is a Bankroll?

1Definition of Bankroll

The bankroll is simply the money players have set aside for playing blackjack. These are funds that are dedicated solely to blackjack play rather than funds one would spend for food, bills, rent, etc. When playing in a brick-and-mortar casino, patrons should also set aside some money for the blackjack tables only. The money for accommodation, meals, and entertainment should be separate, as well.

2Bankroll Strategy

A good strategy is to slowly build up a bankroll. Few people would be able to start their blackjack play with an initial bankroll of a few thousand dollars. A more reasonable strategy is to sit on the table with a bankroll you feel comfortable with – it could be $200, $500 or $2,000. A good rule of thumb is to never gamble money you cannot afford to lose. From there, players should add their winnings to the bankroll or at least set aside some portion of them for their next blackjack session.

3Perfect Bankroll Size

Since blackjack is a relatively fast game, players would bet on anywhere from 50 to 120 hands per hour. So, clearly, players should be able to afford to place these bets – the proper bankroll should then be at least 50 times the minimum bet size. In fact, most experienced blackjack players would recommend having a bankroll worth at least 200 times the minimum bet size. This certainly reduces the risk of losing all your money in one blackjack session.

4Set Some Limits

Building up one’s bankroll is not an easy task – players would win some hands and lose others, and by the end of a game session, they could have made a profit or lost everything. This is why setting some limits before you start to play is a good idea. Some players prefer having a loss limit and once they reach it, they stop playing. Others believe it is best to stop the game while you are still winning. Both principles could be effective, however, especially if applied simultaneously.

5Building Your Blackjack Bankroll

Once a player has set certain limits on the amount he plans to win or feels comfortable losing, he could start building up his bankroll. It is unrealistic to think that all the money you have won would go to your blackjack bankroll – very few people possess such financial discipline and dedication. A good alternative is to set aside half of your winnings and put them into your bankroll. There is more to a good money management plan, however than simply having a strict budget for playing blackjack – it is also essential to be able to keep it and furthermore, to be able to expand it.

How Much Should You Bet?

The size of the bet for each following hand is one of the most important things for card counters whose goal is to make a profit when the odds are in their favor and risk the minimum when the odds are against them. But even players who are applying only a basic strategy should know how to determine the proper size of their bets.

The amount of money players should wager per hand depends on several things - most of all, the amount they are personally comfortable with and their entire bankroll. Card counters would increase their bet size whenever the deck is rich in high cards and reduce it when the deck has “cooled down”, i.e. when there are more low cards than high ones left. Most blackjack players, however, are not practicing card counting and, instead, they use basic strategy to determine their decisions during play. They too should have a good understanding of betting units and betting spread.

Betting Units
Betting Spread

Betting Units

It is easier to talk of betting units rather than the monetary value of bets when discussing money management. A betting unit could be described as the minimum amount of money a player would wager per hand. This could be the table minimum or a higher bet, depending on the personal bankroll. For example, the minimum wager a player would make is $10, so this would be the betting unit. Two betting units would be worth $20, three units would be $30, and so on.

As we have said above, the recommended bankroll for a gaming session is at least 50 times the minimum bet or 50 betting units. Using the example above, this would correspond to $500. A much safer alternative, however, is to start a game of blackjack with at least 200 betting units, which would be $2,000. While this may seem a lot for many, such a bankroll would be more effective in covering the hands you would inevitably lose.

If you play 60 hands per hour on average, this would mean you would spend $600 per hour on the blackjack table. A bankroll of $200 would be then quite inadequate, whereas a bankroll of $2,000 should last for more than three hours, even if you lose every single hand in the game – and that is, of course, highly unlikely if you use a basic blackjack strategy. The higher the bankroll, in terms of betting units, the longer you would play and the less likely you are at losing everything.


Betting Spread

Another term used in blackjack literature is the betting spread – this is the range of different bets you are making throughout the game. It is mainly used by card counters but it is also a helpful tool for money management in standard, basic strategy play. Typically, the player starts the game with 1 betting unit and at some point, he or she would decide to place a higher wager.

A good, conservative betting spread would be 1-10 where the minimum bet is 1 unit and the maximum bet is 10 units. Most players even prefer lower spreads of up to 1-5 or 1-8. In card counting, the betting spread is essential in guaranteeing better profits – players bet the minimum when the house has the advantage and they bet the maximum when the advantage shifts in their favor.

For those who are not skilled enough to track the deck and count the cards, the betting spread of little importance. Still, they could use it to control the money they are spending. Instead of betting your maximum when you feel you are “lucky”, you may try gradually increasing your wagers when you feel more comfortable in your knowledge of the game and your skill to perfectly apply a basic strategy.

Blackjack House Edge, Expected Value and Risk of Ruin

House Edge and Expected Value

Risk of Ruin

To manage their bankrolls properly, all gamblers should have at least a basic understanding of the house edge and the expected value. This way, they would know how much they are expected to win or lose per given period of time. As we have said above, blackjack is a negative expectation value, which means that players would eventually lose, while the casino is guaranteed to win over the long haul.

The house edge is the portion of players’ bets the casino is expected to win. It is also known as an advantage, vigorish, or juice, and it is expressed as a percentage of players’ total wager. Usually, the house edge in blackjack is around 1% to 2% but with optimal strategy, players can successfully reduce it to less than 1%. It varies greatly from one blackjack variation to the other due to the different rules, the number of decks, the various payouts, side bets available, etc.

Interestingly, the house edge changes dramatically throughout the game, as well, as the deck composition changes – with more low cards left unplayed, the house edge is higher, when more high cards remain in the shoe, the house edge may even be negative. This means that players would have the advantage. However, that is something only card counters would be able to detect, which is why we would not focus on it.

So, what is the house edge in the standard blackjack variation? When played under traditional Vegas rules, the game offers a mathematical advantage of less than 0.50%. Usually, casinos offer 8-deck blackjack, where the dealer Hits Soft 17, players can double on any two cards and after a split, up to three splits are allowed, blackjack pays 3:2, and there is no Surrender option. Under these conditions, the house edge will be around 0.65, which means that players would lose on average 0.65% of their total wager, or $0.65 from a $100 bet.

But the house advantage cannot predict how much you will win or lose in a given period of time since it is a theoretical unit that is true for an unlimited number of hands. This is why we need to know the so-called expected value (EV) of the game. It helps players determine their expected loss or win for a gaming session and based on the amount they bet. To calculate the negative EV, we simply use the formula:

EV = House edge x average bet x hands per hour

Considering we play a game with a 0.65% house edge (0.0065), our bet is $10, and we play 70 hands per hour, the EV will be 0.0065x10x70 or $4.55. This means that the casino will win on average $4.55 per hour from the game. This is also the hourly loss of the player. If the player spends 5 hours in the casino, he is expected to lose $22.75. When it comes to the EV for card counters, however, it will be positive since the formula will not include the house edge but the player’s advantage over the casino.

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Betting Styles and Methods

Now that we have explained the importance of setting up a bankroll and explored how much we can expect to lose or win over time while playing blackjack, let’s take a look at several ways to place bets. Some of these betting methods are quite popular among recreational players, while others are applied only by blackjack pros.

Progressive Betting Systems
The Up and Pull Method
Betting for Card Counters

Progressive Betting Systems

Progressive betting systems are extremely popular among gamblers – they can be used in blackjack, roulette, and many more. They are fundamentally wrong, however, since they make use of winning and losing streaks. Usually, these systems require players to increase or decrease their bets based on previous outcomes. The idea is that you could win a lot when you are on a winning streak. Your wins will eventually help you recover your losses.

However, consecutive wins or losses are impossible to predict and they only appear as “streaks”. This is one of the common misconceptions in gambling and blackjack pros know well that relying on streaks is not an effective strategy in the long term. Popular betting progressions include the Martingale, Paroli, D’Alembert, etc. There is even a betting system using the Fibonacci sequence of numbers although it has no relation to blackjack or gambling at all.


The Up and Pull Method

One of the betting styles is known as the Up and Pull Method. It is used primarily by recreational and beginner-level players and it is based on the so-called winning and losing streaks. Using it, players start their game with 2 betting units and if they lose, they reduce their bet to 1 unit. If another loss occurs, they start again with 2 units. On every win, the bet increases by 1 unit and whenever the player loses, he goes back to the start.

Although some players consider this way of betting a method, it is, in fact, a betting progression using the following sequence – 2, 2, 3, 4, 5, 6, 7, etc. The idea is to maximize the winnings from several consecutive wins and recoup any losses. This is why the Up and Pull is actually a progressive betting system, which we have already discussed. Since there is no mathematical proof of its effectiveness, it is avoided by professional blackjack players.


Betting for Card Counters

Card counters never use progressive betting systems but they do use methods to structure their wagers in a way that it can bring them the greatest profits. The good betting spread is instrumental in the success of any card counting system. For most counting systems, bets remain at the minimum at running counts of +1 or less. When the count reaches +2, players start increasing their bets by 1 unit – +2 count suggests betting 2 units, +3 count suggests placing 3 betting units, etc.

Others prefer doubling their current bet whenever the count increases by 1. For instance, 1-8 betting spread means that the player initially wagers 1 unit, then 2 units on a +2 count, 4 units on a +3 count, and 8 units on a +4 count.

Some guides on card counting recommend using large betting spreads such as 1-15, 1-20, or even 1-50 as they bring larger profits for the player. While this may be true, large betting spreads are also seen by casinos as a clear indication for card counting. This is why they should be avoided and players should stick to more conservative spreads of up to 1-5, 1-8 or 1-10.

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