Kelly Criterion
The mathematically growth-optimal fraction of capital to risk on a sequence of independent bets given a known edge. For a simple binary bet with probability p of winning and a ratio b of win-to-loss outcome, full-Kelly is f = (p × b - q) / b where q = 1 - p. The criterion maximizes the long-run geometric growth rate IF the edge is known with certainty AND outcomes are independent AND the return distribution is well-behaved — none of which holds exactly for an equity investor. Full-Kelly is therefore a useful theoretical anchor rather than a practical sizing target; fractional Kelly is what most professionals actually use.
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Absorption Rate · AFFO per Share · Allowed Return on Equity · Alternative Investments · Anchor Tenant · Assets Under Management
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