I found this very neat Kelly Formula simulator a while ago and wanted to share it with my readers. This applet is almost a Monte Carlo simulator that calculates your expectancy and position size based on your win probability and win/loss ratio.
Based on my Forex Trading, my win/lose ratio is about 1.5 and my win probability is about 0.60. Based on the Kelly formula, I should bet up to 34% of my trading equity in one trade or 11.3% in three smaller trades (each). Try playing around with it, its really fun and it can really help you understand how well your trading system is working!
<applet code="My.class" name="My" codebase="https://hquotes.com/tradehard" align="middle" height="400" width="500">
<param name="textcolor" value="0000FF" />
<param name="textsize" value="20" />
<param name="textstyle" value="1" />
<param name="background" value="FFFFFF" />
<param name="text" /> </applet>
From around the Social Web!
Want to leave a comment?
If you want to give me some feedback on this post, please contact me
via email or on Twitter