We’ve looked at the importance of having a genuine bank, and the benefits of diversifying your punting approach.

Both are important factors, and the management of them together is therefore equally important.

Punters who diversify into following multiple approaches are immediately faced with the conundrum of how to structure their bank to suit.

Using a single bank is the most simple approach and one that’s adopted by many, often just by default.  The punter works with one bank of 100 units, for example having a $10,000 bank and staking $100 per unit across every system.

This is a fairly standard approach when betting a single strategy, however when you diversify into multiple strategies there are other risks.

Splitting your bank

Think about it: using a single, 100 unit bank across multiple systems obviously means none of your systems have their own 100 unit bank.  The bank is split by the number of systems you’re using.

This will be fine if all systems are on a nice linear curve upwards.  But as we know, that’s not how punting works.  Variance means you’re going to run into downswings and flat spots in performance.  If multiple systems happen to coincide in a downswing, your drawdowns for each are compounded on top of each other.

You could see your entire bank disappear very quickly.  We’ve seen it happen.

The impact on staking

The other issue a single bank has is the impact on staking for each strategy, because the one bank is exposed to the performance of others.

Most punters, at some stage, change their stakes based on the growth of their bank.  If your $10,000 bank becomes $15,000, then a $100 unit can become $150.

Some punters reset this with every bet. Others may do it once a month, once a quarter, or once a year. And others never do it, content to keep their staking steady.

There’s no ‘right’ approach: it depends on what suits your own psyche and punting goals.  But the theory of course is that staking (or level of investment) rises for consistently well-performing systems, and falls for those that that don’t deliver.  So it has merit.

The problem here with a single bank is that you can never adopt this properly based on the performance of each strategy.

If your bank grows overall, your stake will rise.   Yet within your single bank, certain approaches may be under-performing.  To ‘reward’ those with a higher stake – just because their under-performance has been offset by your other, independent systems – is illogical and in effect, a form of loss-chasing.  Which we know never ends well.

Divide your bank

What much of this serves to illustrate is the advantage of splitting your bank properly.  Giving every system its own dedicated, separate bank allows their performance (and your response to their performance) to remain independent from each other.

The systems aren’t related, so their bankrolls shouldn’t be either.  Separate 100 unit banks means you’ll always be covered against variance and drawdown.  And any change in your stake will be reflective purely of that strategy’s performance, rather than an overall mix of others.

Working capital

One other point that some punters find frustrating: having multiple, 100 unit banks obviously means you can have a large amount of funds dedicated to punting, depending on how many strategies you’re employing.

Some say this money isn’t “working hard enough”.  For example, if you have 100 units in the bank, and only two units currently employed in a pending bet (investment) for that system, then you have 98 units sitting there not working.  It can be a lot of money to have sitting around doing absolutely nothing for you.

It’s true: unwagered cash in betting accounts is dead money.  It doesn’t earn interest – for you, anyway!  It just sits in the bookie’s bank account.

The thing to remember here is there’s absolutely nothing forcing you to keep that money there.  Your betting bank doesn’t need to sit in your betting accounts!  You may like to keep it in your own bank account or similar, and only transfer it to the bookmaker when you need it to bet.

That way, it can earn (or save) interest for you rather than the bookie.  It’s your money, so that’s what it should be doing!

Just ensure it’s easily accessible (for when you need to drawdown), not at any risk (a normal bank account is the most obvious example), and it’s clearly separate from other funds such as everyday spending, etc – it’s not a betting bank if you just blow it on other things.

Happy banking!