Answer the following question with 100 per cent honesty: Do you have  an  actual BANK for your betting? That is, a set parcel of money purely for betting.

I know most punters will answer NO (if they are being totally honest). And that’s nothing to be ashamed about. When betting is a recreational pursuit, you don’t really need to worry too much about restricting yourself to an established bank.

However, if you are SERIOUS about your betting, whether you place your trust in jockeys, like Greg Childs or Darren Beadman or bet via the formguide, then you really do need to get this side of things into order. Run your betting as you would a business. Be strict with costs and so on. Work with what you’ve got and not with cash out of the pocket.

Gordon Pine, who writes lots of great articles for the US Netcapper website ( has plenty to say on the subject of bankrolls and how best to manage your money.

In a recent article he made a number of emphatic points and put forward some bright ideas. Here in part is what Gordon says:

For most horseplayers, their “bankroll” is whatever they have in their pocket. You know you're talking to serious handicappers if they've taken a certain sum and set it aside as their horse wagering bankroll.

I've always bet with a separate wagering bankroll. For years, I've played a percentage of my bankroll based on my historical edge, usually calculated (by quickly looking at my records) before each raceday.

Often, when I'm trying out or tweaking a new method, I will use my mini-bankroll method, which basically involves starting with a miniscule amount but applying a Full-Kelly percentage. It combines the advantage of an insignificant worst-case scenario (losing a $40 bankroll) with a great best-case scenario (a positive-expectation strategy balloons a bankroll really quickly because the bet size is so bold, yet still within mathematical reason).

But recently I've been tweaking my money-management strategies a bit. This is partly due to talking to other players, and partly due to a couple of things I've been reading. In his interesting booklet Horse Market Investing, David Schwartz introduced me to the "session concept."

He points out that most games have a defined beginning and end where you either win or lose. However, the horse race wagerer's game either never ends or ends badly, with the destruction of his bankroll. Without a defined end to the game, the best a handicapper can do is maintain and build his bankroll, sometimes drawing out money for personal use. But if there's no end to the game, how can a player really win?

Schwartz' sessions are defined by a goal, such as doubling or tripling your bankroll. If you reach that goal, you've won the session, and you reward yourself by withdrawing a portion of the profits and starting a new session.

Aside from the practicality of this approach – it sets up a method for paying yourself – it's psychologically sound.

Handicapping is tough on the psyche for lots of reasons. For instance, you almost always lose more events (races) than you win, and that takes its toll. And handicappers aren't exactly placed on a social pedestal as devotees of an honoured pastime, despite the fact that chess is easy in comparison.

It's a good ego-boost to set a financial goal at the track and then meet it.

Steve Fierro tweaks the session concept in The Four Quarters of Horse Investing by using a time period rather than bankroll growth to define his session.

I like this idea, because I like the concept of regular paydays if you've earned them. As Fierro says, "I have chosen to use calendar months as my sessions. My game ends every month. A losing month is simple, no payday...

Following a losing month I must get back to the original bankroll amount and surpass it by a required dollar amount. I then pay myself. My paycheck for the month is the amount I have won above the original bankroll for that month. You got it, just like any normal businessman would do."

As an inveterate tweaker myself, here is what I plan to do. Like Steve, after each winning month, I will take a payday. Since I'd like to build my bankroll, I'll take half of any profits above the original bankroll, after making up for any losses that might have occurred in the previous months.

Then I'll add this tweak, suggested by handicapper Jim Oddo. If my bankroll doubles during a month, another rule goes into effect: If I then lose 30% of my profits from my doubled bankroll, I will take all my profits for the month so far and restart at my original bankroll size and bet size.

I know from personal experience that this would have mitigated my historical tendency to quickly run up a bankroll and then give a lot of it back.

If your bankroll is whatever's in your wallet and your financial plan consists of trying not to hit the ATM more than once per trip to the track, then you might consider mapping out a money-management method for yourself.

Consider adding session-concept guidelines that give you the opportunity to periodically take profits and win the game you're playing.

I found this summary from Gordon Pine most interesting. It puts right into context many of the aspects of betting and money management that worries so many of us.

The point he makes that “the game never ends” is sharply to the crux of everything, as far as I’m concerned. Why? Because I’ve never thought of my race betting in that manner, but it’s so absolutely true.

A keen racing fan will bet till he dies. So where does profit start and finish? How long can you make a winning run last? A week, a month, one year, two years, 10 years? Think about it.

It’s because of this never-ending piece of string that Gordon Pine makes his observations as above.

Somehow or other, the punter needs to set goals. Steve Fierro set himself a monthly goal. He framed his entire money management structure around that goal. Gordon Pine intends to take a payroll approach, always snipping something from the total profit as a payout to himself.

There is much to be said for having a Reserve Bank as well as your main bank. When the main bank turns in a profit, set at the monthly goal, you tweak 20% of it for yourself, put 20% in the Reserve Bank, and keep the remaining 60% active in the main bank.

The Reserve Bank is, if you like, your “fighting fund” to come into use ONLY if you wipe yourself out on the main bank. This wipeout should never occur if you bet sensibly but it’s always nice to know you have the Reserve Bank around. It will build up nicely through the good times with all those monthly 20 per cent profit sums going into it.

The thing to always bear in mind, as the thrust of this article explains, is that you are playing a game with no end.

You have to make those “ends” in various stages, whether it be a daily goal, a weekly goal, a monthly goal or an annual goal.

Put profits in your pocket, keep playing the game, and always remember that you need to win often to make it all worthwhile in the very FINAL end, which if you’re a mad-keen punter will be that day you sight your last formguide and bet on your final race before departing this mortal coil.

Only then will your final balance sheet be stamped and franked. This man spent XXXX dollars and he got back XXXX dollars. It could be profit or loss in the end-game.

Hopefully, along the way, you will have had many, many little “goals”’ that returned you enough to make betting a pleasure and not a pain.

By PB King