The Kelly Criterion is a formula for sizing bets to maximise the long-run growth rate of your bankroll. Bet too little and you grow slowly; bet too much and variance will destroy you. Kelly finds the exact sweet spot.
Example: a 60% win chance on a 1:1 bet gives f* = (1·0.6 − 0.4) / 1 = 20%. Bet 20% of your bankroll each round for optimal growth.
Over-betting past Kelly reduces your long-run growth and risks ruin. At 2× Kelly your expected growth rate is zero — the same as not betting at all.
Each round presents a bet with a known edge. Size your bet using the Kelly Criterion to maximize long-run growth. Your discipline shapes the opportunities you receive.