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> I found
> that if you had long strings of loosers (as you'd expect
> from time to time especially with a low win ratio medium
> term system) then optimal F was much better. If, however,
> you had a system with a high win ratio (and thus lacking
> many long strings of loosers) then you were better off not
> reducing the bet size.
That about covers it. I never used to reduce size because I had done all
my money management testing on "decent" systems. However, Gary F.
finally convinced me it was foolish. I was being stubborn so he sent me
a spreadsheet to simulate what happens if a good system goes bad. That
was all it took to change my mind. You never know what the future holds
and preservation of capital is job one. If your system blows up, for
whatever reason, and you don't reduce size, you will be out of the game
by the time you accept that it's broken and not just a temporary
drawdown. So, I decided it's better to accept a little less return for
far less risk of ruin.
--
Dennis
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