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It's trying to maximize EV[log(money)] instead of EV[money]. This is probably wrong in and of itself as an assumption to make. But if you *do* want to make that assumption, then e.g. you have to consider all of your assets that don't have anything to do with the pool.

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Do you disagree with the Kelly criterion in general? en.wikipedia.org/wiki/Kelly_cri

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So: 1) it's not literally *wrong* in that it doesn't make a math error 2) I disagree in general that Kelly is the right way for people to bet because I disagree with its assumptions 3) neither 1/2 are necessary for my argument: Kelly only works if you consider *all* your money

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There are other problematic assumptions snuck in here, e.g. a) the paper assumes that you can only do one or the other forever and can't ever take profit if you don't use an AMM b) the paper assumes that exponential increase in valuation can go on forever

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E.g. see what happens to the math if you assume: a) The person is only using 25% of their money in this particular USD/coin pair and 75% outside of the system b) you only expand out ~10 years

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a) Assuming no rebalancing between the 25% and the 75% portfolio? Then my advice would be the same b) Come on, I thought an effective altruist would have a more timeless perspective!

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Heh -- so: a) I think that "hold for 10 years then sell some" is prob closer to what you get in some assumptions here b) more generally, though, an effective altruist would have a massively more linear utility function than log(money)

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Not if they are trying to invest in order to give!! (And again, utility function is not relevant.)

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your parenthetical is incorrect, see the other thread Investing to give: on what scale should an EA have strongly decreasing marginal utility? I claim the correct scale here is roughly $20b or so. So, yeah, once you're worth $20b, it might make sense to become more Kelly-like.

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> So, yeah, once you're worth $20b, it might make sense to become more Kelly-like. FWIW there is literally 0 doubt in my mind we will have AMM pools >$20B within next few years