Kelly Criterion Calculator
The Kelly criterion gives the fraction of your account that, bet repeatedly, maximises long-run growth for a given edge. It's a useful ceiling — and it's aggressive enough that almost nobody bets full Kelly, because the drawdowns are savage and the formula assumes you know your edge exactly. You don't.
- • Full Kelly = win rate − (1 − win rate) ÷ (reward : risk).
- • If that's zero or negative, you have no edge and Kelly says bet nothing.
- • Half and quarter Kelly keep most of the growth with far smaller drawdowns.
Worked example: a 50% win rate at 2 : 1 gives 0.50 − 0.50 ÷ 2 = 25% full Kelly — so half Kelly is 12.5% of the account per trade.
Overestimate your edge and full Kelly ruins you; that's why fractional Kelly is the norm. Assumes a fixed, known edge and independent trades. Educational tool, not advice.
A calculator shows what a rule should do on paper. Whether a strategy actually beats simply buying and holding — costs on, losses shown, no hindsight — is a different question, and the only one that pays. Test one on real data, free, no sign-up.