I feel like I've grown a bit. I used to be very cautious. Unless there was a black swan event, I'd typically open with a $50,000-$100,000 bet for small coins, $1-2 million for altcoins, and $10-20 million for major mainstream coins. Overall, I'd keep the drawdown to no more than 40%. This was a way to control drawdown.
Recently, I've been getting a little provoked by some people. They say, "I have a high win rate and plenty of money, so why shouldn't I bet?"
Limiting your position is a coward's choice. Since you can be sure of a high win rate, you should increase your position.
A few days ago, I received a reply that went on and on about how it's impossible to quantify black swan events in the cryptocurrency market and that I was forcing the Kelly Criterion into practice. I was too lazy to respond to such idiotic behavior.
Let me explain the Kelly Criterion using quantifiable data from Texas Hold'em. Do I have any quantifiable cryptocurrency data?
So, does the greater the drop in the cryptocurrency market's black swan events, the greater the probability of a rebound, and the longer the odds of a rebound? According to the Kelly Criterion, does the greater the win rate and the longer the odds, the larger the bet?
That reply received a lot of likes. Are these people mentally ill? When you encounter a fool, you're truly speechless. And when you're speechless, you really want to laugh.
Forget it. I don't know why I'm so kindhearted, always wanting to teach fools a lesson. Even though I've posted on WeChat Moments saying I shouldn't teach them anymore.
Many people, including everyone at my company, have a particularly bad habit of always betting the same amount on a particular type of coin (small, altcoin, or mainstream). For example, for small coins, it's always $20,000, never more. They don't differentiate their positions based on specific opportunities or coins. I think this shows a lack of thought. If you're sure it's a big opportunity, you should bet big. If you think the opportunity isn't good, you should reduce your bet.
Losing money on big opportunities, rather than frequently wasting it on small ones.