placing several bets at once using Kelly criterion

[warriorfan707]

[QUOTE=mebaran;12892731

I say a team has a 56% chance to win an event. This is based on a framework I have deemed statistically significant. Step 1 complete.

[/QUOTE]

This is the only problem. How do you come up with 56%? Its just a guess.

From an alternative perspective though I can see how theoretically it could possibly work long run but you would have to make sure you stay consistent with your formula. Any variation on your estimates could be disastrous using Kelly.

[mebaran]

This is the only problem. How do you come up with 56%? Its just a guess.

From an alternative perspective though I can see how theoretically it could possibly work long run but you would have to make sure you stay consistent with your formula. Any variation on your estimates could be disastrous using Kelly.

!!! This is exactly why many proponents of Kelly recommend using fractional Kelly so that any errors in calculation don't cost you growth.

[FourLengthsClear]

The main issue is the variables in the equation are purely speculatory.

The variables in the Kelly equations are well proven and not just in sports betting. The only sensible criticism of Kelly is what was discussed earlier, the inability to accurately determine edge per wager.

[FourLengthsClear]

How do you "compare your prediction of the game with the markets"????

The closing line is the markets' prediction.

[JimHadley]

Simultaneous kelly is done by taking the product of 1-kelly for all simultaneous wagers and then multiplying each kelly amount by that product. So if I have two simultaneous bets, one calling for a full kelly wager of 2.5% and another calling for a 2% wager then I would bet (1-.025)*(1-.02)*2.5% = 2.387% on the first wager and (1-.025)*(1-.02)*2% = 1.91% on the second wager.

What if you had already placed the first wager at 2.5% of bankroll?

[JimHadley]

Kelly betting is horrible.

What do you recommend?

[maxvalue1]

if using Kelly.and i believe I have a 55% probability of winning bet..that would be 5.5 % of my bankroll.
Now my question is ...if i want to use half kelly...do i simply divide 5.5 % by two? ..2.75%

[mebaran]

if using Kelly.and i believe I have a 55% probability of winning bet..that would be 5.5 % of my bankroll.
Now my question is ...if i want to use half kelly...do i simply divide 5.5 % by two? ..2.75%

For simplicity's sake, yes. (Kelly calculator says 2.7553%)