kelly criterion wett-rechner. 00, not, say, $75 - which, at the outset of your gambling. kelly criterion wett-rechner

 
00, not, say, $75 - which, at the outset of your gamblingkelly criterion wett-rechner The Kelly Criterion, Part I, Basic Kelly Math

3 b = 0. It does not use caution or assign value to risk. The fractional Kelly criterion becomes incredibly simple and intuitive when we express the annualized expected geometric excess return as a function of fraction of full Kelly allocation. 2 e − 161In determining the Kelly criterion, a gambler needs to specify the probability pof placing a correct (i. The edge is simply the advantage you hold (or think you hold) over the actual bookmaker’s betting odds. For sports bettors, the Kelly Criterion sports betting strategy is capable of maximizing potential profit, while minimizing both volatility and threat. This fraction should be equal to the difference between non-default probability ( p) and default probability ( q ). The formula is as follows: Where: K % = The. The idea was derived from an American scientist John L. The Kelly Criterion and the Stock Market / LOUIS M. The Kelly Criterion is a staking method well known across wagering and investment professionals which should be known and considered by all Betfair punters. Kelly suggests maximizing the expected value of the logarithm of our money, so we want to maximize p. The Kelly Criterion. how much to bet; b is the net odds received on the wager (“b to 1″); in the example above, it would be 1. On 40. This formula is derived by maximizing the expected value of the log-growth rate of a bettor’s bankroll, assuming certain conditions are met (more on this later). This strategy is also used in investment management – Warren Buffet is. Managing Risk With Math. 4)/1 = 20% or 0. The question arises because it is widely believed that the Kelly criterion is best for betting online, while, in fact, its use is appropriate only if our betting system has been actually proved profitable. there must be a positive expected return. 6) – 0. In the book, Dandho Investor, superstar investor Mohnish Pabrai devoted an entire chapter. )It's also the form which most directly suggests how to derive the Kelly criterion, and therefore the situations in which it will/won't apply. Suppose player A wins b units for every unit wager. and the second part is the optimization of that strategy through Kelly criterion. Thorp famously applied it to bet sizing in blackjack when the player knows that he/she is getting a. Kelly Criterion gambling is. Results. 51. 5% and 1/8 1. With Kelly Criterion we can find the optimal solution for determining the amount of investment. The Kelly criterion, developed by John L. The calculator will tell you whether or not you should be betting and how much to stake. The Kelly Criterion is a mathematical formula used to determine the optimal amount to bet based on the edge you have over the sportsbook. There is a 60% chance of a winning a coin flip. Kelly stake percentage = Edge – 1 / Odds – 1. The criterion was introduced with the purpose of. 2 maximize benefits using Kelly CriterionPart 3 - Kelly Criterion. In essence, the Kelly Criterion helps a punter gauge the level of risk in a wager and matches it to a punter’s desired risk betting level. If you check out Wikipedia or Investopedia, you’ll see formulas like this: f ∗ = p − 1 − p b − 1 f ∗ = p − 1 − p b − 1. 35 * 0. The basic knowledge comes from the “Kelly criterion,” which was provided by Kelly Jr. Kelly himself was an interesting character: a chain smoking Texan who used to be a fighter pilot in the Navy during World War 2, he was also brilliant researcher. Betting a Half Kelly Stake, for example, reduces bank volatility by 50%, but growth by only 25%. History. As discussed, that’s pretty much the case with 50/50 leagues, but not at all the case in heads-up leagues. More than 100 million people use GitHub to discover, fork, and contribute to over 330 million projects. It just happens to coincide with log-utility. The left-hand side of the equation, f*, is the percentage of our total wealth that we should put at risk. Disclosure. 04. 50 x 0. The Kelly’s formula is : Kelly % = W – (1-W)/R where: Kelly % = percentage of capital to be put into a single trade. The true probability may lie between 40% and 60%, or even 20% and 80%. Kelly Criterion. Make your sports betting experience easier with our Kelly Criterion calculator, learn about the Kelly Criterion and how much you should wager to maximise your profits! Get Our FREE Betting Calculator App Enter the number of times you’ll place the sequence of wagers. Thorp used the Kelly Portfolio to produce 20%. Betpoints: 1. Kelly Criterion Example. The closer to 1 you get, the better. - If it's successful, you earn 100 times your money, so your odds are 100/1=100. Equivalently, we can take the logarithm to transform the product into a sum. Kelly, Jr. 10. 2. 025. 1 – 1. So yes, now that I’m living in NYC, I’ve been known to occasionally throw down a fun tennis bet every now and then. 45)/ (2. If you can find an exploitable, repeatable edge, Kelly's system tells the maximum you should bet based upon. Poker players have been stuck using outdated bankroll management techniques for decades, and I want to change that. At the moment, I'm just doing a 15% fractional Kelly but wondering if anyone has spent much time tuning Kelly-based allocations. The odds are in your favor, but read the following carefully: According to the Kelly criterion your optimal bet is about 5. Keep in mind that this is a high percentage and the ideal amount you should bet is 3% of your bankroll or less. This is the well-known "Kelly Formula" (aka 'Kelly Criterion. The Kelly bet size is found by maximizing the expected value of the logarithm of wealth, which is equivalent to. Suppose we have initial capital X 0 and we want to determine the optimal betting fraction f to invest each year in S&P 500 stocks. To calculate the “W,” divide the number of trades that brought in a positive amount by your total number of trades. By Paul Butler – January 27, 2019. It just so happens that, being a mathematician by training, he wrote up a detailed paper, The Kelly Criterion in Blackjack, Sports Betting, and the. As indicated by the formula, the optimal bet is determined by the formulaK= W - (1 - W)/R — where K is a percentage of the bettor's bankroll, W is the likelihood of a favorable return, and R is the. The Kelly criterion or Kelly strategy is a formula used to determine position sizing to maximize profits while minimizing losses. KELLY, JR. I'm trying to apply the Kelly Criterion to poker. You win $100 if the dice shows up as a 1, 2, or 3. The Kelly bet size is computed by maximising for the expected value of log (wealth) . Kelly Formel – Sportwetten Quoten Rechner. The strategy maximizes the entropy and with probability one outperforms any other strategy asymptotically [3]. The Kelly Criterion is a strategy that can be used in several. The Kelly criterion is a money management system that’s used by many professional traders and hedge funds. the Kelly Criterion to the stock market. When the odds are 1:1 (a=1 and b=1), the optimal betting size becomes f∗ = p − q f ∗ = p − q. In such a case, the Kelly criterion suggests that if one were to go over 20% repeatedly on a low. 124 2 = 5. F = Fraction of capital to invest in equities. 70. The only way a player can ever gain an edge over the casino in blackjack is through the use of basic strategy and card counting. If they allow the customer to bet too big in the start they might be able to win and wipe them out in one go, but forcing customers to use small bets ensures that profit approaches the expected value, which for all games is tilted in the casino's favor. The Kelly criterion with Kelly number 0. Strategy 1 gains 8% with probability p, and loses 5% with probability 1-p, where p = 0. 6 +. 5. By the Kelly criterion, the bidding fraction will result in an expected return of í µí°´40µí°´40. In his original paper, Kelly proposed a di erent criterion for gamblers. In the one asset two valued payo case, the optimal Kelly wager is the edge (expected return) divided by the odds. Most importantly the criterion gives motivation to decide between investments with identical expected value but different risk of default. The trouble is that the financial market is a continuous flow and does not follow this model. If the expection is not positive, then f∗ ≤ 0 f ∗ ≤ 0 and the optimal amount to bet is to not (obviously). 2. Add your expected win probability for the selection you have chosen in the cell called “Win Probability”, using values between 0% and 100%. Works best when used in retrospect. So you first need to decide your bankroll size and the length of time you’ll be using the Kelly method. g. 40) / 1 = 0. where: K – optimal % risk. Kelly Criterion Calculator. where 𝑓∗ is the Kelly Fraction - the optimal amount you invest in your risky asset while the rest sits in a hypothetical risk-free asset (e. 20*0. You have to remember that the basic Kelly Criterion formula is meant to optimize bets for black-and-white, independent outcomes. In his post on the Kelly criterion, Zvi notes that full Kelly is only correct if you know your edge and can handle the swings. Gayle Keller. 5 if you want to wager 50% of the stake recommended by the Kelly. Abstract and Figures. 100:1 odds 0. Nutzen sie einen hilfreichen Kelly-Kriterium-Rechner für jede beliebige Wette. 1-p)The Kelly Criterion is an incredibly fascinating and useful method to use to arrive at the amount of money you should bet or invest. For example, if you think the fair odds of an outcome are 2. 5% to 2% of your bankroll per bet. In essence, the Kelly Criterion calculates the proportion of your own funds to bet on an outcome whose odds are higher than expected, so that your own funds grow exponentially. 4 and a win-loss ratio (R) of 3. According to the Kelly criterion, the probability of getting a return of -5 or less in this example is only 5. 5. Bet calculator and free betting calculators to determine payouts. The criterion is known to economists and financial theorists by names such as the “geometric mean maximizing portfolio strategy”, maximizing logarithmic utility, the growth-optimal strategy, the capital growth criterion, etc. By Kelly criterion, in a game with win rate of 50% and odds 2, the optimal bid ratio is 25%, which leads to the best capital growth rate. The point of the Kelly criterion has never been to maximize expected wealth. A core principle of the Kelly Criterion is that the player must have an edge over the house before making a bet. The kelly criterion is a theory that measures the long-term growth of capital. THORP 922 A Simple Proof of Tychonofrs Theorem via Nets / PAUL R. To follow up on that. However, unlike in the previous situation we examined the Kelly Criterion for, there is not a nite number of outcomes of a bet on a security, so, we will useHow to Use the Kelly Criterion. in 1956. 10, you can calculate your edge as 2. You must scale the Kelly output so that the amount you bet is equal to the potential loss. If you bet more than 10%, you’re taking on too much risk. Here, the formula is F = W – [ (1-W) / R] W = Probability of success. The Kelly Criterion is a formula which accepts known probabilities and payoffs as inputs and outputs the proportion of total wealth to bet in order to achieve the maximum growth rate. This paper examines how the Kelly criterion, a strategy for maximizing the expected log-growth of capital through informed betting, can be applied to non-mutually exclusive bets. The Kelly criterion for the stock market. Source: The Kelly Criterion in Blackjack Sports Betting, and the Stock Market by Edward Thorp. We advise you to set it at 0. 3 e 55 7. Wettrechner und Quotenrechner - Überprüfen Sie Ihre potenziellen Gewinne auf den Akkumulatoren mit unserem Wettrechner, Quotenrechner, Akkumulator berechnen, Lucky 15, Each Way, Doubles, Trebles und mehr. I’m a professional trader and former quant and I don’t know a single actual pro who uses anything like Kelly to size bets. Use the Right Formula. The first bettor (blue line) bets exactly $5. If you want to be more conservative than the Kelly criterion, enter a value less than 1 (e. Despite the fact that Kelly's theory has been extended to most of the trading strategies used in financial markets, there is still a large gap between the theoretical. is the Kelly Criterion. W is the winning probability factor. Computing and following an exact decision tree increases earnings by $6. Kelly, who was a member of a research center at AT&T’s Bells Lab, New Jersey in 1956. Say 100k capital. How to Use the Kelly Criterion Calculator. 5% win rate. The same principle would work for any investment with an expectation of being profitable. e. The fraction of wealth allocated to each asset is known as the Kelly Portfolio which optimizes the long term compound growth rate of total wealth. The NFL just doesn’t stop cooking up. The Kelly Criterion is a formula for bet sizing that leads to optimal expected wealth. The standard kelly betting is 1. Alternatives to Kelly Criterion. However, in order to reach that conclusion, we must wager with a flat betting plan for a large number of bets. Here are the steps that you have to follow in order to use our Kelly Criterion Calculator: Add your current betting balance in the cell called “Current Betting Balance”. Theoretically, since in roulette the player has no advantage the Kelly tells to not play at all. 1 chance of winning -- kelly & net odds around 0. at Bell Labs, is a strategy for the optimal sizing of bets in the repeated bets scenario in his seminal paper¹. Kelly put forward the Kelly formula while conducting research on the probabilistic errors in communications. input 0. For example, if you have a 60% chance of winning and a 40% chance of losing, and your payoff is 2 times your loss, your edge is 0. The reason is because in order for the. As discussed, that’s pretty much the case with 50/50 leagues, but not at all the case in heads-up leagues. The purpose of this study is to address the critical issue of optimal credit allocation. To calculate the “R,” divide the average. e. The Kelly criterion for the stock market. Use our Kelly Criterion Calculator to determine the optimal amount for a series of wagers. Full Kelly allocation is achieved when portfolio volatility is equal to the Sharpe ratio of the portfolio. The Kelly Criterion is a mathematical formula that helps gamblers determine optimal bet sizes and maximize profits. A Kelly Criterion Calculator helps you decide what percentage of your bankroll you should wager on a sports bet. In this post, I’ll apply it to a EURUSD breakout strategy and explain some of its potential shortcomings when applied to forex trading. 5, the Kelly criterion formula would recommend risking 32. To be honest I have been successfully using the simple/naïve Kelly Criterion for years and haven’t bothered looking anywhere else. Your calculation is wrong, because it maximizes the expected wealth. The outline of the remaining parts of the paper is as follows. Nicholas joins Chris for a conversation on correctly sizing your investments using the Kelly Criterion,. 1 Main Idea In the gambling game we just described, the gambling probability and payo per bet do not change, and thus, from an intuitive stand-point, it would make sense that an optimal solution would bet the same fraction, f, of your money for every trial. Refresh the page, check Medium ’s site status, or find something interesting to read. Disclosure. Der Kelly Formel Rechner für Sportwetten hilft Ihnen dabei, einfach und bequem Ihre Einsätze und deren Verteilung zu berechnen. 05/1 = . Based on the Kelly criterion, K% = (1 × 0. As I mentioned earlier, the formula is a mainstay of the gambling and investing worlds to help manage risk in asset management. The Kelly criterion is a theoretical formula for obtaining the best return when repeatedly investing money. One thing that complicates the matter is that short term results can. There is a 60% chance of a winning a coin flip. We’ll be experimenting with the Kelly criterion formula for a practical example. 3 is the profit rate if I win an investment, p = 0. $egingroup$ @elemolotiv I read a lot more after that post. It has a CAGR that is 1% less than the S&P 500 (5. As mentioned earlier, the Kelly Criterion is a variable after the probability and odds variables, and when this variable is expressed in the form of the index. version" is mentioned in a few of the better introductory textbooks, and it is the subject of William Poundstone's excellent popular book Fortune's Formula. With hand waving and basic math you can also use it to help guide your investment decisions. To increase it to 5. After graduation, he worked in the oil industry. Wettende sollten nicht ihren Impulsen folgen, sondern immer auf einen mathematisch belegbaren Vorteil achten. E. While this formula is great, it still only. 5 for long-term wagering. The Kelly bet size is found by maximizing the expected value of the logarithm of wealth, which is equivalent to. It is widely applied to sports betting and casino gambling. After two rounds, about $185. The counterpart is the efficient market hypothesis. 38 percent Kelly bet, or $53 of your current bankroll ($1,220 x 4. 17. 67%. Here’s. The Kelly Criterion calculation is used to calculate the optimum stake or position size for a given event, and is made up of four factors. 55×1-0. Adjust your Kelly fraction by your posterior uncertainty. The Kelly Criterion is 6. Given return of a portfolio or a single asset modeled as a continuous, but not necessarily gaussian, probability distribution, what's the Kelly criterion equation? I've heard that it's simply the the ratio of the sharpe ratio to the standard deviation. What is more commonly seen is betting less than the full Kelly amount. That means 55 (the percentage probability you think your bet will win) minus 45 (the percentage probability you think your bet will lose) will give you 10. To simplify the analysis, however. 3) / 3] = 0. [1] in 1956, who proposed the Kelly criterion to solve the bidding problem with imperfect information by communications errors. So never do it. 25, there's a Gambler's ruin. This means if the Kelly Criterion advises a bet at 10% of your bankroll, if you’re using 1/2 Kelly it would be 5%, 1/4 2. Kelly Criterion was originally developed considering discrete win-lose bets in the decision making process. 55)-0. The Kelly Criterion is a mathematical formula used to determine the optimal amount to bet based on the edge you have over the sportsbook. Results. Kelly Criterion. Casting. As we will see, in the case of maximizing an individual’s relative wealth, the. 05. Betting fractional Kelly is actually far more common than full Kelly, in order to reduce the risk of ruin. This type of situation is common in horse racing, where. (1923-65), was born in Corsicana, Texas. How to Use the Kelly Criterion Calculator. 0 Kelly on even 1 bet reduces the growth rate of your capital while increasing risk of ruin. If we’re high-frequency traders, we may want to think twice before betting on this game. In Platen (2011), the Kelly criterion de nes a portfolio that cannot be outperformed long term and whichThe best staking plan debate. It seems that the web-article should be more appropriately called "A quick article to give you an ERRONEOUS IDEA" on Kelly Criterion when it says: "An example would be that1% edge would equal betting 20% of the bankroll. Half Kelly % of bankroll = (. Bettors can also modify the Kelly formula to suit their needs and tolerance to risk. Kelly Criterion (kCrit) = ((odds - 1) * (1 - winP)) / (odds - 1) 'odds' is the Decimal form of the American odds after conversion. 50. 55)-0. In such a case, the Kelly criterion suggests that if one were to go over 20% repeatedly on a low. If it hits my stoploss, i lose ~2k. For the gambler/investor with average luck bankroll and a fixed bet size, the expected bankroll growth after one. He gives lectures to various institutions including The World Bank, Carnegie Mellon, and billion-dollar hedge funds. 35) / 0. However, finding that amount to invest requires immense confidence in your ability to research and come up with precise and accurate probabilities and accompanying magnitudes. The Kelly criterion: exploiting favorable bets and the stock market In many ways this is my favorite topic to talk about. ) Kelly criterion will maximize your (log) account if the maximum possible loss is exactly 100%. A law of the theory of betting is that the optimal procedure is to bet proportionally to one's advantage, adjusted by variance. (Kelly Criterion) I was wondering about the real-world use of the Kelly Criterion in relation to Cash Secured Puts. In most gambling scenarios, and some investing scenarios under some simplifying assumptions, the Kelly strategy will do better than any. significant leverage) or more for a position. In probability theory, the Kelly criterion, or Kelly strategy or Kelly formula, or Kelly bet, is a formula used to determine the optimal size of a series of bets. Enter the probability (%), which represents the likelihood of winning the bet. The origin of money management was studied by John Larry Kelly, Jr. Tim Byrnes, Tristan Barnett. While the Kelly Criterion calculator defaults the multiplier to 1, you’re encouraged to adjust the multiplier based on your preferences. the Kelly Criterion to the stock market. 4. Because the Kelly Criterion seeks to calculate the optimum stake for any value bet so as to maximise that value as well as maximise the growth of your betting bankroll. The conclusion is: Kelly Criterion is the numerical expression of the attitude of the gaming company to a certain result of the game. the Kelly Criterion to the stock market. If you can find an exploitable, repeatable edge, Kelly's system tells the maximum you should bet based upon. you can win. The Kelly Criterion, Part I, Basic Kelly Math. For example, if you invest 100 and get 10, the gain is 10%. A Kelly portfolio maximizes the expected return of any given combination of assets in the long run, by maximizing the geometric growth rate of the wealth, which can be expressed by: g_{infty}(f^*) = frac{(mu - r)^2}{2sigma^2} + rThe Kelly Criterion is a statistical and mathematical formula that helps a punter estimate the maximum and minimum amount to give in a particular betting situation. 3 Development of modified Kelly criteria. Kelly developed the formula while working at the AT&T Bell Laboratory. In this case, the Kelly criterion betting strategy suggests that if you wager over 20% of your bank continuously on 1, 2. This paper presents a model to address the uncertainty inherent in replacement problems, whereby a firm must select between mutually exclusive projects of unequal lifespans by applying the Kelly criterion (which is not well known to the engineering economics community) within a binomial lattice option-pricing environment. So basically, in the most general sense, "Kelly" just means use a log-utility when balancing risks. L. To associate your repository with the kelly-criterion topic, visit your repo's landing page and select "manage topics. Make up a decent bankroll. This formula determines the optimal % of your account that you can bet to get the most profitable outcome in the long run. Let’s play a game. The better a player's chances of winning based on the card count, the more the player bets. 40)-0. The Kelly Criterion is a technique to maximize long term wealth, when presented with an opportunity that has favorable odds. So which is the most OPTIMAL bet to make , that grows your bankroll the. Improve your game and make the. Managing Risk With Math. resource for various forms of investing too, as its primary. 2. Understanding the Kelly Criterion. if your max loss is 50%, optimal-f will be double kelly. One was the 'square root' plan whereby a base bet is established, say $20, and each bet you place is $20 plus the square root of any. 2. Kelly itself can-never make a profitable system un-profitable unless the system is lying about its statistics in the first place. The Kelly Criterion helps you calculate the optimal amount you should wager when there is a difference between the true odds and the given odds at the. The performance of the model are hence studied as a function of the input capital state under the assumption that the latter belongs to the set of. Methods similar to those already described can be used to maximizeAccording to the classical Kelly criterion, a bettor should bet a fraction of their bankroll equal to edge / odds, assuming edge > 0. , the amount of money you will win for. The Kelly criterion has received widespread attention, and some of the attention has been negative (Samuelson 1979). In your example you have savings which will bring in some percentage no matter what. 53. The original Kelly criterion says to wager only if (bcdot p-q > 0) (the expected value is positive), and in this case to wager a fraction ( frac{bcdot p-q}{b} ) of your bankroll. Further, suppose that on each trial the win probability is p > 0 and pb - q > 0 so the game is advantageous to player A. 52. While it is possible to create a simple spreadsheet that will execute the Kelly Criterion Formula, there is no. 0. winning) wager using a speci ed gambling system. - According to the formula Kelly fraction = 0. Kelly, Jr. The specifics involve too much algebra for me to elucidate here. Um den Kelly Formel Rechner zu benutzen brauchen Sie nur die angebotene Quote und die Wahrscheinlichkeit in das Formular einzugeben. An Example; Analysis Results; Conclusion; Introduction. When substituting into the Kelly Criterion formula, would the payout ratio be 1. will take. 3 and x is your resulting bankroll. The Kelly Criterion is comprised of two basic components. The expected return from a winning outcome. By calculating the optimal size of your bets based. So let's say I have a portfolio X. pyplot as plt import decimal as d # Probablility of winning. We need to maximize E (G) = (1 + (O-1) * X) p * (1 - X) 1-p - 1 with respect to X, subject to X lying on the unit interval [0,1]. The formula was developed by Kelly while working at the AT&T Bell. Abstract: Kelly's Criterion is well known among gamblers and investors as a method for maximizing the returns one would expect to observe over long periods of betting or investing. And not just wrong but SO WRONG that anyone who believed it was an idiot. Rechner und Wettwerkzeuge. 05/1)/2 = . f ∗ = p (b + 1) − 1 b. PK. The Kelly criterion proposes to choose f so that g(f) is maximized. The Kelly criterion can easily be extended to uneven payoff games. Let's take a user who also likes using the traditional 1X Kelly Criterion and has a gambling bankroll of $1,000. I like to break up the Kelly chart into four sections: Yellow: from Zero to 1/2 Kelly is the Conservative risk area. However, it is important to recognize that the Kelly Criterion assumes accurate probabilities and stable edge over time. The formula has a number of applications, one of which is sports betting. Conclusion. The casino is willing to pay 2 to 1 on any bet you make. My confusion is how to apply the Kelly formula once the system goes live and I am making trades based on the system signals. So, the optimal size of your stake in this example would be 8. The equity balance. On the other hand it is arguably. The Kelly Criterion was the subject of an incomprehensibly bitter argument in the 1970s/1980s. This formula is derived by maximizing the expected value of the log-growth rate of a bettor’s bankroll, assuming certain conditions are met (more on this later). Therefore, it is best to use half or even a quarter Kelly. When I try to calculate the. Kelly Criterion มีที่มาอย่างไร ผมไม่ขอพูดถึงเยอะ เนื่องจากที่ผ่านมามีหลายบทความหรือเพจต่าง ๆ เขียนอธิบายไว้แล้ว แต่ผมจะขอสรุปสั้น. John Larry Kelly, Jr. 00 = 1. It is often described as optimizing the logarithm of wealth, and will do better than any other strategy in the long run. We develop a general framework to apply the Kelly criterion to the stock market data, and consequently, to portfolio optimization. Revisiting the Kelly Criterion Part 2: Fractional Kelly Another common complaint about the Kelly Criterion is how to manage multiple edges on concurrent bets. The goal was to figure out the best ways to manage signal-noise issues in long-distance telephone. W = Dollars won per dollar wagered (i. Kelly in his famous article on the information rate, has proven to optimize the growth of an investors’ wealth if one follows the formula of Kelly diligently. Note of difference between the discrete and continuous criteria: The Kelly criterion is designed to protect your equity from. In particular, it maximizes the expected growth rate and the median of the terminal wealth.