This staking plan was developed by John Kelly in 1956. A good explanation of this staking plan is given on TheStakingMachine site.
This plan used Kelly’s Criteria to calculate the stake. To use it you should estimate a chance that your selection will win. Let’s name this estimation ‘p’. Formula to calculate the stake is:
f = ((b – 1) * p – (1 – p)) / (b – 1) stake = bank * f / divisor where 'b' is current decimal odds of your selection.
Divisor is used to divide the Kelly’s stake to keep it under reasonable size.