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Thread: Is 13.5% RoR optimal for fastest bankroll growth?

  1. #14
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    Stealth. The difference in what you are saying and what I am saying is you are saying "when" you resize and I am saying "if you are going to resize". I am talking about looking forward from the point that you calculate RoR. That calculation will assume you are not going to resize because that is the definition of RoR. You are talking about the difference in RoR you had with your old ramp before you sit down to figure out your new ramp and recalculate RoR. You are comparing the 2 RoR's both of which were calculated assuming you will never resize. We are not in disagreement. We are just not talking about the same thing.

    You are right though. To say what I was trying to say my statement should have been:
    RoR is not what changes if you intend to resize someday. The odds that you will bust out someday is what changes.

    I see how things got confused now. I expressed myself quite poorly. hat I was trying to say is not what I said. At the bare minimum what I was trying to say was ambiguous the way I said it. At the extreme what I said was not what I was trying to say. I wouldn't say my command of the English language isn't strong. But I do seem to have a problem using the English language to express what I am trying to say. I hope everyone understood what I was trying to say even if I said it poorly. If not I am done for now so hopefully one of the times I expressed myself I got it right. I certainly threw enough darts at the dartboard to expect to luck into a bullseye.

  2. #15


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    RoR is generated based on the assumption that we never resize. However, we do resize, I guess the more often the better.
    So RoR is treated as a reference, not a rule to follow. If my bankrolled dropped from 10000 to 8000, then I’ll have a new reference, and adjust the bet ramp accordingly.
    So RoR assumes never resize, but we use different RoR as the bankroll changes.

    I’ve always kept a RoR of around 5%, but theoretically, why is 13.5% optimal?
    Isn’t 20% RoR make the bankroll grow faster if adjust to 20% RoR after every bankroll changes.


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  3. #16


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    I would say it has to do with Nzero, someone qualify will explain soon, hopefully.

  4. #17


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    "I’ve always kept a RoR of around 5%, but theoretically, why is 13.5% optimal?
    Isn’t 20% RoR make the bankroll grow faster if adjust to 20% RoR after every bankroll changes."

    Short answer: no. If you overbet Kelly by double, eventually you go broke. If you overbet by less than double, your bankroll experiences large swings and, ultimately, doesn't grow as quickly as if you had bet proper Kelly.

    13.5% isn't "optimal." 13.5% is the ROR associated with betting full Kelly for a given bank and never resizing.

    Don

  5. #18


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    Quote Originally Posted by Three View Post
    Unfortunately RoR has two meanings. Its pure meaning is as you say it but it is also a stat from sims. If you intend on resizing RoR is almost always used as a stat since it is meaningless if you are going to resize. And we all resize. So RoR is the stat that tells you what your chances of busting out in the fairytale land where you will never resize your bets.
    Quote Originally Posted by Three View Post
    Most pros have a big enough BR that they aren't going to increase their bets because they are against table limits or heat thresholds. They also don't want the changes in win rate associated with drawdown and later adjusting bets back up again. By playing to a very low RoR you probably won't ever have to drawdown.
    Since the pros represent the extreme minority in the gaming circles, lets touch on the real reality that exists, to which Three refers to as fairytale land, where he believes that their couldn't possibly be anyone who does not re-size their bets. Lets put aside the pros who are up against table limits, there are thousands more poorly banked beginners who are up against bad rules and table minimums. Often they bust out because of short-term losses and do not have the option of draw downs by lowering their unit. Some will then proceed to take on more risk without adding to their playing bank, and compound the problem by lowering the upper end of an already small spread and subsequently result in failure. The only correct options they should have done after taking some losses was to either temporarily quit and build up the playing bank, or if they insisted on still playing, to only Wong in/out with a 1 to 4 spread. Three, yes we all "as in this board" re-size up or down when it is needed, but we make our money off of those that don't, who think that they know something about the game.
    Last edited by BoSox; 04-19-2018 at 11:57 AM.

  6. #19


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    If you like to read, suggest you pick up a copy of FORTUNE'S FORMULA by William Poundstone. A lot of the book is related to items OTHER than Kelly. But, it has a great discussion of Kelly, RoR, etc. It discusses the upside (and downside) of Kelly, using a full-Kelly vs Half-Kelly or some other fractional Kelly.

    Basically, a book of how Kelly has been used in investing.

    Again, much of the book is devoted to material other than Kelly. But, it has a great discussion of Kelly.

  7. #20


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    Quote Originally Posted by terry0222 View Post
    If you like to read, suggest you pick up a copy of FORTUNE'S FORMULA by William Poundstone. A lot of the book is related to items OTHER than Kelly. But, it has a great discussion of Kelly, RoR, etc. It discusses the upside (and downside) of Kelly, using a full-Kelly vs Half-Kelly or some other fractional Kelly.

    Basically, a book of how Kelly has been used in investing.

    Again, much of the book is devoted to material other than Kelly. But, it has a great discussion of Kelly.
    It's a really really fun read.

  8. #21


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    Quote Originally Posted by terry0222 View Post
    If you like to read, suggest you pick up a copy of FORTUNE'S FORMULA by William Poundstone. A lot of the book is related to items OTHER than Kelly. But, it has a great discussion of Kelly, RoR, etc. It discusses the upside (and downside) of Kelly, using a full-Kelly vs Half-Kelly or some other fractional Kelly.

    Basically, a book of how Kelly has been used in investing.

    Again, much of the book is devoted to material other than Kelly. But, it has a great discussion of Kelly.
    Thanks for the recommendation! I just ordered it on Amazon. It looks like a good read. Looking forward to it!

  9. #22


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    Quote Originally Posted by terry0222 View Post
    If you like to read, suggest you pick up a copy of FORTUNE'S FORMULA by William Poundstone. A lot of the book is related to items OTHER than Kelly. But, it has a great discussion of Kelly, RoR, etc. It discusses the upside (and downside) of Kelly, using a full-Kelly vs Half-Kelly or some other fractional Kelly.

    Basically, a book of how Kelly has been used in investing.

    Again, much of the book is devoted to material other than Kelly. But, it has a great discussion of Kelly.
    Thanks, I’ll read it.
    If changing bet ramp constantly based on bankroll, what is the optimal RoR to be kelp for fastest bankroll growth?


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  10. #23
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    As Don has already said, there is no optimal RoR.
    There is only a RoR associated with Kelly's optimal bet (W=B*E/V) and Bankroll of the moment but if you do not resize.
    Incidentally, this RoR is 13.53%

    In CVCX, you set "Kelly factor" to 1.
    Not "Risk of Ruin" to 13.53% even if both are linked.
    Last edited by Phoebe; 04-22-2018 at 12:37 AM.

  11. #24


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    Quote Originally Posted by Philippe B View Post
    As Don has already said, there is no optimal RoR.
    There is only a RoR associated with Kelly's optimal bet (W=B*E/V) and Bankroll of the moment but if you do not resize.
    Incidentally, this RoR is 13.53%

    In CVCX, you set "Kelly factor" to 1.
    Not "Risk of Ruin" to 13.53% even if both are linked.
    What are the factors in W = B * E/V ? Is it "Optimal Wager = Bank Roll * Expected Value / Variance"

    Thanks.

  12. #25


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    Quote Originally Posted by MercySakesAlive View Post
    What are the factors in W = B * E/V ? Is it "Optimal Wager = Bank Roll * Expected Value / Variance"

    Thanks.
    Yes. Well, Optimal wager = bankroll * edge / variance. Just to clarify because someone might get confused by using expected value, when expected value is a function of edge and wager.
    "Everyone wants to be rich, but nobody wants to work for it." -Ryan Howard [The Office]

  13. #26


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    Thanks RS. and edge is just "iba" right?

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