nickerwin1990 on Nostr: Great video on using the Kelly Criterion as a tool when factoring portfolio ...

Great video on using the Kelly Criterion as a tool when factoring portfolio allocations between two assets with one of them serving as the base (primary measure of value.) They Kelly criterion is very useful because it factors heavier on the Power Law instead of Sharp ratios like most allocator tools. It suggests allocating 75% BTC and 25% Cash (USD) with cash as your base. Obviously I'm all in on BTC but very interesting. Then for us maxies out there it suggests an 18% allocation to MicroStrategy when using BTC as your base (measure of value.) So how I look at it with my own portfolio is in 100% in Bitcoin. Within my BTC portfolio I have a few separate buckets that I allocate accordingly using BTC as the base measure of value. So 1st bucket is my cold storage BTC which is ~ 70%. 2nd bucket is in MicroStrategy which serves as a tax free BTC Proxy in my Roth IRA. My third bucket is my least important and most risky “BTC NFT’s and Defi” bucket with a 10% allocation. So I have a couple BTC Ordinals I bought and I stake STX tokens for a monthly 9% BTC yield. That's it!



https://www.youtube.com/live/hYqzp_-bMZ0?si=NTNI_PwXovlrhc8T