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MJ: BJA3 Question
For the RoR formula on p.112, are all the variables represented by units rather than $?
If I were to plug in the data from a row in the Chap 10 charts into the formula on p.112, should the RoR produced by the equation be identical to that in a given row of the charts?
Lastly, are the # of units for the kelly bank in the Ch.10 charts calculated by SD^2/EV? When I use this equation my results always seem in the ballpark, but never quite identical. Not sure why that is.
MJ
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Don Schlesinger: Re: BJA3 Question
> For the RoR formula on p.112, are all the variables
> represented by units rather than $?
Yes.
> If I were to plug in the data from a row in the Chap
> 10 charts into the formula on p.112, should the RoR
> produced by the equation be identical to that in a
> given row of the charts?
Close. Not sure if perfectly identical. Norm may have used the p. 113 approximation rather than the p. 112 formula.
> Lastly, are the # of units for the kelly bank in the
> Ch.10 charts calculated by SD^2/EV? When I use this
> equation my results always seem in the ballpark, but
> never quite identical. Not sure why that is.
All of the "optimal" lines should be quite precise; i.e., [SD/100($)]^2/[W/100($)] = $10,000, which is the presumed bank for every line.
But, the units for the "practical" lines are all rounded and, therefore, not as precise. They won't come out as perfectly as the optimal ones do.
Don
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