007 wrote: "That's one of the problems with the Kelly Criterion, since it assumes
no outside source of income."
Other sources of income, or for that matter taking funds from the bankroll, can be modeled as changes to EV.
I already provided an example which was $5 double double I believe, which has a negative Kelly CE. As I explained, this cost to play has to come from somewhere. One possible source would be your day job, in effect, if you add from your day job to your bankroll at the rate of the negative CE, you would be at bankroll neutral. And of course if you add to your bankroll faster than it is depleted, you will grow your bankroll, nothing wrong with any of that.
007 wrote: "Going by one's "gut" has its dangers,
too, but most people who lack a sophisticated knowledge of the Kelly
Criterion, including me at least most of my life, have a reasonably
accurate idea of what overbetting means."
Isn't that just a survivor bias? You don't know of anyone who went broke from overbetting?
[Non-text portions of this message have been removed]
Posted by: nightoftheiguana2000@yahoo.com
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