Help with sizing using probabilities (I suck)

[Specterx]

For now, I just size based on the probability that I am wrong

This is IMO the best approach. The goal of my money management is to ensure my max DD target has a very low (<5% per year) probability of being exceeded. Hit rate is pretty much all that matters here, because noteworthy drawdowns by definition occur when you are having long streaks of consecutive losers.

I will double the bet size a couple of times a year when a fat pitch comes along, where market action, sentiment, and fundamentals all line up perfectly and the payoff is highly skewed.

 

[Amahrix]

Related question would be: how do you size based on probabilities?

Hi nooby_mcnoob,

Kelly Criterion.

Ask me if you have any questions after doing some further research. (assuming you've never heard of it).

-A

 

[nooby_mcnoob]

Hi nooby_mcnoob,

Kelly Criterion.

Ask me if you have any questions after doing some further research. (assuming you've never heard of it).

-A

Thanks, this is what I'm going to do. I know GAT has some stuff in his book as well, I should open it back up.

 

[Amahrix]

Thanks, this is what I'm going to do. I know GAT has some stuff in his book as well, I should open it back up.

Hello!

Who is GAT?

Also, check books by Ed Thorpe. He is well-known for major success with this method of betting, in casinos & markets.

-A

 

[tommcginnis]

Stop being mean to mom/dad

Y'mean Mr. Gutless Dooshbagio (whose consumption of protein shakes, steroids and stimulants still can't help him find his shriveled testicles with both hands, self-loathing -- like self-stimulation -- takes two hands) showed up? Did Nutless make more statistical errors, or failure-to-read-before-hitting-Send errors, or simply conflate being an asshole with having something to say errors? That would be an (mildly) interesting study... But then, it would have to be published with his name, and we're back to gutlessness. Ah, well...