1/ How to Size Your Investments (AKA A brief summary of what I have learned about the Kelly Criterion)
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3/ As Taleb pointed out, it is not enough to be correct as an investor, you must be correct in the right amounts, yet many investors don't think about it that way.
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4/ If you make a little money on many trades but lose everything on one big trade, then your "win rate" may be 95%, but you are still broke because you were "picking up nickels in front of a bulldoze"
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Here's an interesting non-financial example of this. After the Vikram lander crashed on the Chandrayaan mission recently, there was an effort to spin it to boost morale, saying "95% of mission objectives have still been met, so the mission is not a failure."
Clearly, whatever the official accounting of goals, psychologically, 95% of the mission value emotionally was sticking the landing safely and getting data back from the lander/rover. It doesn't matter that the rest of the mission objectives were checked off. The mission failed.
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And you could see this in the faces of the mission control staff who had worked for years for these few minutes to go right, and it didn't. Many were crying.
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