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Probability Theory to Maximize Returns
A friend & I were recently discussing the Kelly Criterion as a means of maximizing our returns. Known as 'the scientific gambling method', it leads to higher wealth compared to any other strategy in the long run. A variant is rumoured to be used by legends Warren Buffett & Bill Gross. Investors in the Junior Mining sector would be wisest to opt for betting a fixed fraction of the amount recommended by Kelly, which would reduce volatility and counteract unknown risks. My portfolio is well diversified and my allocations are kept small, which I have found to be an effective strategy in such high risk/reward area.


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Kelly criterion - Wikipedia

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