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>The huge mistake you're making is in assuming that money is infinitely divisible. Let's say you start with $1 and you bet 99 cents and lose. Now try betting 99
by OscarCunningham 9y ago
>The huge mistake you're making is in assuming that money is infinitely divisible. Let's say you start with $1 and you bet 99 cents and lose. Now try betting 99% of 1 cent and see if you don't go bankrupt.
But then it's possible to go bankrupt even if you use the Kelly criterion.
- cardmagic 9y agoKelly criterion never claimed to prevent bankruptcy. It only tells you how to bet to achieve the maximum theoretical return possible given a set of odds and payouts. I say theoretical because unless you're in a casino, you don't know the actual odds and edge you are playing with (because they move) which makes your Kelly ideal bet size a guess rather than a fixed number. Here's more information: https://en.wikipedia.org/wiki/Kelly_criterion https://en.wikipedia.org/wiki/Kelly_criterion