nightoftheiguana2000@yahoo.com wrote:
>Why is Kelly important? How can I answer that question? Read Poundstone's "Fortune's Formula" to find out.
At your recommendation, I read this and I don't agree that it
clarified the importance of the Kelly Criterion. Thorp's competitors
who disagreed with him about the Kelly Criterion did not therefore
totally ignore the possibility of fluctuation destroying an otherwise
winning approach. Those who went bust may sometimes have done so
beause they overbet their bankroll, but, due to the less complete
information that a stock market player has than a blackjack or video
poker player, so could Thorp have. I believe that something like 98%
of Thorp's success was due to positive EV, not that he went by the
Kelly Criterion.
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