You do realize the reason you shouldn't bet more than $10,000 is the same reason you gave for not betting it all in #22? You need funding to provide value with future opportunities.
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eh they're to different degrees; losing 10% of your wealth is a lot less likely to cripple your opportunity to do future things than losing > 50%.
life isn't exactly a game of iterated "exactly the same bet".
And in practice it matters a lot roughly how much $ you'll need!
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The Kelly criteria isn't about iterating the exact same bet either. It's about maximizing your long term growth rate in games of random chance.
The bet can change each time and you still shouldn't bet above the Kelly value.
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long term *geometric* growth rate, not long term growth rate
all-in maximizes long term growth rate
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and it only works if you face nothing in your life but a series of bets that are both (a) uncorrelated and (b) each let you bet up to your entire wealth without any decreasing returns
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which isn't to say Kelly isn't cool! It is cool!
but cool is different from "absolutely the right thing to do in all circumstances, the math proves it".
there's no such thing as ^ when it comes to betting, at least not in general, without knowing more context.
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The math also proves betting more than the Kelly value is lunacy.
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(to be clear, if I offered you a ONE OFF bet, 50/50 coin, on 20:1 odds, you'd bet 47.5% of your wealth; but if I instead offered you a ONE OFF bet, 50/50 coin, on 2000000:1 odds, turning $100k into $200B, you'd think it's "lunacy" to bet 51%?)
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No and yes
Nobody in the investing world that has survived uses full Kelly or would ever recommend it.
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to be clear, you'd bet *less* than half your wealth on a 2000000:1 payout bet on even odds?
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*that*, I think, is lunacy
There’s nothing wrong with this sizing as long as it’s YOUR OWN MONEY and not customers
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