Free tool

Kelly Criterion Calculator for Traders — Full, Half & Quarter Kelly

Enter your win rate and payoff ratio — get the Kelly fraction, your expectancy per trade, break-even win rate and how sensitive the whole thing is to your win-rate estimate. Instantly, no login.

Your edge

Win rate (%) 55%

Or type it exactly

Payoff ratio R (avg win ÷ avg loss)

Kelly fraction

Mode

Half Kelly is the common practical default — see “Why half Kelly?” below.

Half Kelly — risk per trade

—

of your capital

Edge vs break-even

—

win rate minus break-even win rate

Full Kelly f*

—

W − (1 − W) ÷ R

Expectancy per trade

—

in R: W × R − (1 − W)

Break-even win rate

—

1 ÷ (1 + R)

Kelly is only as good as your numbers

Win rate and payoff ratio should come from your real trades, not memory. The ReziFX Chrome extension captures planned trades from the TradingView position tool into a journal — and the app's built-in Kelly calculator (one of five, with saved scenarios) runs on your actual stats.

Try ReziFX free Expectancy calculator

Win-rate sensitivity

Kelly reacts hard to small errors in your win-rate estimate. This is your input ±10 percentage points at the current payoff ratio.

Win rate	Full Kelly	Half Kelly	Quarter Kelly

The formula, explained

Kelly fraction f* = W − (1 − W) ÷ R, where W is your win rate as a decimal and R your payoff ratio (average win ÷ average loss). Example: W = 0.60 and R = 2.0 gives f* = 0.60 − 0.40 ÷ 2 = 0.40 — full Kelly says risk 40% of capital, half Kelly 20%, quarter Kelly 10%. If f* is negative, the system has no edge: the break-even win rate is 1 ÷ (1 + R), and below it the growth-optimal size is zero.

Why half Kelly?

Full Kelly maximizes expected logarithmic growth — on paper. In practice it produces brutal drawdowns (a full-Kelly bettor spends a third of the time below half of peak equity) and it punishes estimation errors asymmetrically: betting above the true Kelly fraction reduces growth and can even make it negative. Half Kelly keeps roughly 75% of the growth rate at about half the variance, which is why it is the standard practical compromise and the default here.

The sensitivity table above makes the estimation problem concrete: shift your win rate by a few percentage points — well within normal sample noise for a journal of 50–100 trades — and the “optimal” size can move dramatically. Treat Kelly as an upper bound and a diagnostic, not a target.

Frequently asked

What is the Kelly criterion?

The Kelly criterion is a formula for the fraction of capital to risk per bet that maximizes long-term logarithmic growth: f* = W − (1 − W) ÷ R, where W is the win rate and R the payoff ratio (average win ÷ average loss). Example: 60% win rate and R = 2 gives f* = 0.60 − 0.40 ÷ 2 = 0.40, i.e. 40% full Kelly and 20% half Kelly.

Why is my Kelly percentage negative?

A negative f* means the combination of win rate and payoff ratio has negative expectancy: on average each trade loses money, so the growth-optimal position size is zero. Mathematically it happens whenever your win rate is below the break-even win rate 1 ÷ (1 + R). Example: with R = 1 you need more than 50% wins; at a 40% win rate f* = 0.40 − 0.60 = −0.20.

Should I use full Kelly or half Kelly?

Full Kelly maximizes expected log growth but produces violent equity swings and punishes estimation errors hard — betting above the true Kelly fraction actually reduces growth. Half Kelly keeps roughly 75% of the growth rate at about half the variance, which is why it is the common practical default. Quarter Kelly is more conservative still. This calculator defaults to half Kelly for that reason.

Can I use the Kelly criterion for trading?

With caution. Kelly assumes you know your true win rate and payoff ratio, but in trading both are estimates from a limited sample and they drift as markets change. Small estimation errors can turn an apparently positive edge into over-betting. That is why practitioners who use Kelly at all typically use a fraction of it (half or quarter) and recompute it from an up-to-date trade journal rather than from a handful of recent trades.

Educational tool. Not financial advice — trading involves substantial risk of loss.