First of all, some definitions. Let's say you are a serious bettor. You must have a bankroll, or Asset, or simply "all the money you are ready to lose on betting". This must exist in real world, right? And indicator ROI does not include it in it's formula, which make no sense. ROI actually 'assumes' your bankroll is indefinite. Here is an example, let say a tipster you follow has -10% ROI, and you followed him (or her) with 10$ stake per bet (flat staking). How much did you lose? Well, it obviously depends on the number of picks he published. If it's a 100, you invested 1000$, and lost a 100$. But if he published 1000 picks, you lost a 1000$ with same math, so the question is, how much money did you have at the beginning of the story, in another words, what was your bankroll. If it was less than a 1000$, you lost it all.

Now let's transfer to ROA (in some literature is called ROC, as RoCapital, as well). And we will talk in terms of units, just to be more general. So first think you have to do is decide of how many units is your asset (or bankroll made). Less units means more risk, but grater and faster profits. I recommend 20 units bankroll (so 5% of your original asset will be invested in every pick - flat staking). If a tipster is consistent, with low deviation, you can even have less units. If a tipster is deviating highly (e.g. has +20 on 50 picks, and than -20 on next 50 picks), 50 units is a better and less risky fit.

So, what does RAO tell you? It tells you how much of your original asset or investment have you returned or profited. For example, if you use 20 units bankroll, and your current profit is +5 units, your ROA is 5/20=25%. 100% means you doubled your money, and -100% of course, you lost it all.

Hopefully I covered it all, any additional questions or explanations are welcome in comments area, to make it more clear and understandable to everyone.

Pinnacle Killers17/01/2018 08:13It is very important for an education of a bettor to understand the math of this. I like the article, but I would like to point out, or add, a few things. As you said, ROI doesn't tell the whole story. A tipster that has 5 picks in a month has 20% ROI, but if you are not a suicidal bettor, and you use flat stake of 2% of your bankroll, your bankroll goes up 2%. On the other hand, a tipster that has 150 tips in a month, and has 3% ROI, with the same stake, your bankroll goes up 4.5%. So the quantity (for the good and for the bad) is VERY important. And the other thing I would like to point out is that 5% of the bankroll as a flat stake is pretty suicidal. It means that if you go on a stretch of, let's say, 6-26, you are broke. Even something less bloody like 7-21, you lose 14 units, 70% of your bankroll, sometimes you cannot even place all the bets you want, cause you have only 6 units left. And NO ONE goes the whole life without a brutal stretch like this. They come much more often than one may expect. I consider it pretty aggressive even if you go 2% of your bankroll on a single bet. Of course, it also depends of the style of betting. Someone betting (I assume it is a successful bettor, an unsuccessful one will lose eventually, no matter what % of the bankroll they use) on stakes like 1.50 on average are less likely to go on a really bad stretch then someone betting on average odds of 3.50, even if their ROI is approximately same. In any case, it is pretty easy to calculate the "expected" return on your initial investment. profit (in %) = number of picks * ROI * % of the bankroll risked on each bet. For example, let's say you have 150 picks in a month, 4% ROI and you risk 2% of your bankroll on a bet. Your bankroll after a month will go up

Pinnacle Killers17/01/2018 08:18150 * 0,04 * 0,02 = 12% If you recalculate your stake after a month, then you have exponential gains, in one year (1.12)^12 = 3.9 So, as long as it is smooth like this, using just 2% of your bankroll, you almost quadruple your initial bankroll in one year. So, even someone not willing to risk a lot of money to start with, let's say 1000€ initial bankroll, as long as he is patient, in three years he has a bankroll of 60000€ and at the rate of success we assumed (4.5% per month) that is 2700€ per month.

NBA Odds machine17/01/2018 10:33@Pinnacle Killers First of all, thank you for this great addition to the article. I agree with your comments all the way, expamples getting the essence of point that I’m trying to emphasize. If there was a possibility, your comment would would go directly in the article, with you as a co-autor.

NBA Odds machine17/01/2018 10:46One more explanation, I also agree that betting 5% of a bankroll is pretty aggressive, there’s two reason why I use it. First is obvious, greater profit in shorter time period. And second one is the fact that in last 2016/2017 NBA (pilot) season, maximum relative decrease was -15 stakes. If that kind of stability will be sustained during this and next season, my overall profit goes skyhigh.

NBA Odds machine17/01/2018 14:54Additionally, you don’t need the whole 20 units all the time, for exactly given, if prior to mentioned 6-26 run you had 83-63, you are still on your original bankroll. In another words, negative stretch must not happen at the begging.

Pinnacle Killers18/01/2018 21:17Well yes, but if you are 83-63, then you actually doubled your bankroll, 20 units *5%, and if you dont increase your bet, then you are actually using 2.5% when the bad stretch happens.

Cash Bet Invest03/04/2018 17:56Is very interested article, is a true. I think one bankroll is good, but is no.