T H I N K I N G
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B E T S
THE KELLY C
HOW TO APPLY THE CELEBRATED BET-SIZING AND CASH-MANAGEMENT FORMULA IN TRADING AND WAGERING. BY NICHOLAS YODER
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amblers and traders alike should get to know the Kelly criterion intimately. The formula, developed in 1956 by Bell Labs scientist John Kelly, uses Information Theory to calculate how much to wager or invest to maximize long-term wealth. But the criterion is often poorly understood, and its misuse leads to the ruin of many would-be traders. Their wealth skyrockets and then collapses to zero because they fail to grasp that the line between defeat and long-term profit is written in the language of mathematics. Two keys unlock success in professional gambling and serious trading: 1. Identifying profitable opportunities
Luckbox | August/September 2021
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7/21/21 10:58 AM
