The Kelley Protocol

The Kelley Protocol, also known as the Kelly Criterion, is a mathematical strategy used to determine the optimal size of a sequence of bets to maximize long-term growth of capital. It calculates the percentage of your total funds to wager based on the edge (advantage) you have and the odds, balancing risk and reward. By doing so, it helps avoid over-betting and potential big losses, while ensuring you capitalize on favorable opportunities. Originally developed for gambling, it’s now also applied in investing and other areas where decision-making under uncertainty is involved.