Enter your win rate and average win/loss ratio to get the Kelly fraction — the mathematically optimal bet size — plus the safer half and quarter Kelly.
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The Kelly formula computes the fraction of capital that maximises long-run compound growth for a strategy with a known win rate and payoff ratio:
A negative Kelly means the strategy has no edge — no position size fixes that. A positive Kelly is a ceiling, not a recommendation: full Kelly assumes your win rate and payoff are known exactly and stable, which is never true in trading. Estimation error makes full Kelly violently volatile.
That's why practitioners use half or quarter Kelly — capturing most of the growth with far smaller drawdowns. Compare the result with the 1–2% fixed-fractional rule; for most retail strategies quarter Kelly lands in a similar zone.
Stop calculating trade-by-trade. TradeDiary imports your trades from Zerodha, Groww, Upstox, Dhan & more, and tracks these numbers across your whole history.
Start Free — No Credit Card →Because it assumes your win rate and payoff ratio are exact. In reality they're estimates from a limited sample; if the true edge is smaller, full Kelly over-bets and produces brutal drawdowns. Half Kelly gives about 75% of the growth with half the volatility.
From your trading journal — computed over at least 30–50 closed trades of the same strategy. Using imagined numbers makes Kelly meaningless. TradeDiary computes both automatically from your imported trades.
Not necessarily — Kelly sizes total capital allocation, while the 1% rule caps loss per trade via the stop distance. Both frameworks agree on one thing: if you have a genuine edge, consistent moderate sizing beats sporadic big bets.