Before bets are placed on horses, it is recommended that a betting bank is created.
The creation of a betting bank is part of the discipline that is required of those who place bets on horses.
The betting bank should contain sufficient funds to support all future betting activities but should not contain so much that it will cause financial hardship should it be completely lost.
Once the betting bank has been created, it is recommended that is divided into two equal parts.
One part should be used for betting purposes and the second should be used as an emergency bank, just in case the original betting bank is completely lost.
The betting bank should be ‘ring-fenced’ in that it should be isolated from all other sums of money. It should not be used for purposes other than betting.
The betting bank has three purposes:
• To provide funds for betting activities • To store the profits from our betting activities. • To limit potential losses to a sum that can be reasonably afforded.
In this way, the profit and loss from our betting activities can be determined relatively quickly and easily.
The size of the betting bank indicates just how successful our past betting activities have been.
The size of the betting bank also determines the size of the stakes, as discussed in the article on losing runs.
When the profits of our betting activities are such that betting bank is double its original size, it is advised that 50% of the funds are withdrawn.
The bank will then be returned to its original size.
The withdrawn amount should be used to create an ‘emergency’ bank unless an emergency bank already exists.
If this is the case, the withdrawn amount may be used for any purpose other than betting.
The withdrawn amount prevents stakes becoming too high and also ensures that past profits are retained.
If a betting bank is completely lost, the emergency bank should be used to provide funds for future betting activities.
However, the selection system that was responsible for the loss of the betting bank should be discarded and not used again since it is obviously inadequate for our purposes.
The emergency betting bank should, therefore, be used in conjunction with a completely different selection system.
If the emergency betting bank is completely lost, it is strongly recommended that you give serious consideration to terminating your betting activities since it may mean that betting on horses, and betting in general, may not be an activity which is compatible with your psychological make-up.
This is a rather long-winded way of suggesting that you should quit!
Some people use only one selection system and therefore a single betting bank, together with an emergency bank, is appropriate.
Some people, however, use multiple selection systems. In this case, although a single emergency bank is adequate, it is recommended that each system is assigned a separate betting bank.
In this way, the profitability of each system can be determined relatively quickly and simply. It also allows us to quickly determine which system is the most successful and, therefore, the one that we should concentrate on in the future.
From the above, it can be seen that one should never underestimate the importance of creating a betting bank.