The Kelly criterion
Once you have an edge, the next question is how much to allocate. Kelly turns your edge and the price into the position size that grows a portfolio fastest — without trading yourself broke.
What Kelly actually optimises
Kelly sizes each position to maximise the long-run growth rate of your portfolio, not the profit on any single position. Position too little and you leave growth on the table; position too much and a normal losing streak ruins you.
It needs just two inputs — your estimated edge and the returns. The bigger the edge and the longer the price, the larger the fraction it tells you to allocate.
Why almost everyone uses fractional Kelly
Full Kelly is only optimal if your probability estimate is perfect — and it never is. Overestimate your edge and full Kelly turns dangerously aggressive.
Half- or quarter-Kelly keeps most of the growth while cutting volatility and drawdowns sharply. It's the standard professionals actually use.
Kelly across a portfolio
Real investors hold many positions at once, sometimes correlated. Applying full Kelly to each in isolation ignores that overlap and over-allocates the portfolio.
Yoseri sizes every signal with fractional Kelly and caps exposure across correlated positions, so the maths stays disciplined automatically.
Theory is nice. Edges pay.
Yoseri does the pricing, edge and portfolio math for you — free to start, no card.