1, the first purpose of Kelly formula is to control bankruptcy risk, and the second purpose is to increase your asset growth rate. 2. When it is applied to futures and other financial derivatives markets, it is necessary to correct the coefficient according to its own strategy, especially the gambling ratio (because there are many factors that affect the price in the financial derivatives market, and it will also be affected by the intersection of strategy and mentality).

In probability theory, Kelly formula (also called Kelly equation) is a betting strategy to maximize the long-term growth rate of principal in independent repeated games with positive expected net income. This formula was published by JohnLarryKelly in Bell System Technology Journal of 1956, and can be used to calculate the proportion of funds to be bet in each game.