Sizing is the decision with the largest effect on the outcome, and the one people get wrong by a factor of ten. Kelly is the fraction that maximises long run growth, and its formula is short enough to check by hand.
About 1 min of reading
Compute a capped size
Write edge and odds
Before you run it, say out loud what it will print. Then open the answer.
Compute the ratio
Before you run it, say out loud what it will print. Then open the answer.
Halve and cap
Before you run it, say out loud what it will print. Then open the answer.
Notional ignores curvature. A size in risk units is the same size across a book with different shapes.
Zero size. Kelly is the function that makes refusing a decision, which is why it is preferred over a fixed stake.
Edge over odds. Both numbers are already known from the previous lesson, so the sizing has no new inputs.
Full Kelly assumes the estimate is exact. Estimates are not exact, and the error is multiplied by the size.
Half Kelly with a cap is the standard because it is the version whose worst case is bounded.
Each one is defined here on this site. Open the entry for the full definition and the other words it points at.