{"enrichment":{"faq":[{"a":"Kelly Criterion computes the mathematically optimal fraction of your bankroll to risk on each trade, balancing growth against ruin risk. The skill implements the Kelly formula with practical guidance on fractional sizing (0.25x\u20130.5x recommended), edge estimation from trade history, and portfolio-level adjustments for correlated positions.","q":"What is kelly criterion bet sizing and how does it work?"},{"a":"Kelly Criterion calculates optimal bet size by combining your win rate, average win size, and average loss size into a single formula. The skill helps you estimate edge and win rate from trading data, then applies the Kelly formula to determine what fraction of your bankroll to risk per trade. Fractional Kelly (0.25x\u20130.5x) is recommended for practical trading to reduce drawdown risk.","q":"How do I calculate optimal position size using Kelly?"},{"a":"Fractional Kelly reduces full Kelly sizing by a conservative multiplier\u2014typically 0.25x or 0.5x\u2014to protect against estimation error and real-world volatility. Kelly Criterion's full formula assumes perfect edge knowledge; fractional Kelly for practical trading applications acknowledges that your edge estimate may be wrong, smoothing growth curves and lowering catastrophic ruin risk while still outperforming fixed-size betting.","q":"What is fractional Kelly and why use 0.25x or 0.5x?"},{"a":"Kelly Criterion guides you to extract three metrics from your trade history: win rate (winning trades \u00f7 total trades), average win size (mean profit on winners), and average loss size (mean loss on losers). These feed directly into the Kelly formula to compute your true edge. The skill helps validate that your edge is positive and statistically meaningful before sizing positions.","q":"How do I estimate edge and win rate from my trading data?"},{"a":"Yes. Kelly Criterion addresses managing multiple correlated positions with Kelly sizing by adjusting allocations across your portfolio. When positions move together, naive Kelly sizing on each independently can over-leverage your total exposure. The skill provides portfolio-level adjustments to account for correlation, ensuring your combined risk stays within acceptable bounds.","q":"Can Kelly Criterion manage multiple correlated positions?"},{"a":"Apply conservative Kelly to high-uncertainty meme token trades by using fractional Kelly at 0.25x or lower. Meme tokens have unpredictable volatility and edge estimation is unreliable; fractional Kelly reduces position size dramatically, cutting ruin risk while preserving long-term growth. Full Kelly is dangerous here; conservative fractional sizing is the practical approach.","q":"When should I use fractional Kelly for meme token trades?"}],"shadow_tags":["position-sizing","risk-optimization","bankroll-management","edge-estimation","portfolio-allocation","drawdown-control","fractional-betting","geometric-growth","sizing-framework","capital-preservation"],"summary_rewrite":"Kelly Criterion computes the mathematically optimal fraction of your bankroll to risk on each trade, balancing growth against ruin risk. The skill implements the Kelly formula with practical guidance on fractional sizing (0.25x\u20130.5x recommended), edge estimation from trade history, and portfolio-level adjustments for correlated positions."},"files":[{"bytes":10973,"path":"skills/kelly-criterion/SKILL.md","sha256":"df7552b7d1b414e7bd47e5afb7d777c992732a9f3ffa01df9cf395c2009036aa","url":"https://skillfed.io/files/agiprolabs/claude-trading-skills/kelly-criterion/a4d458b4/SKILL.md"}],"id":"agiprolabs/claude-trading-skills/kelly-criterion","links":{"html":"https://skillfed.io/agiprolabs/claude-trading-skills/kelly-criterion","md":"https://skillfed.io/agiprolabs/claude-trading-skills/kelly-criterion.md","repo":"https://github.com/agiprolabs/claude-trading-skills"},"meta":{"agents_supported":[],"first_seen":"2026-07-28","forks":52,"language":"Python","last_updated":"2026-06-24","license":"MIT","name":"kelly-criterion","publisher":"agiprolabs","stars":248},"relations":{"similar":[{"id":"agiprolabs/claude-trading-skills/position-sizing"},{"id":"lyndonkl/claude/market-mechanics-betting"},{"id":"PuckAPI/claude-sports-analytics/edge-detection"},{"id":"JoelLewis/finance_skills/bet-sizing"},{"id":"magicjordan33/sports-betting-claude/bankroll-management"},{"id":"mnemox-ai/tradememory-protocol/risk-management"},{"id":"PuckAPI/claude-sports-analytics/bet-tracker"},{"id":"PuckAPI/claude-sports-analytics/backtesting"},{"id":"tradermonty/claude-trading-skills/position-sizer"},{"id":"Wind-Information-Co-Ltd/wind-skills/position-sizer"}]},"slug":{"owner":"agiprolabs","repo":"claude-trading-skills","skill":"kelly-criterion"},"version":"a4d458b4"}