Why risking only 1/3 of your account makes sense for this trading style

The trades I am using should work over 90% of the time, possibly 95%. At current volatility, they return around 15% on margin. The Kelly Criterion says we should risk 23.3 to 61.1 percent of an account with this sort of return ...

But the plan involves 2-4 trades on simultaneously, possibly a few more during earnings season.

And all of these should be fairly closely correlated, meaning that in rare circumstances all could lose simultaneously even using the very wide .10 delta mentioned in the last post.

But some events swamp even the .10 delta:

Including certain mistakes that one can imagine being made by this guy:

Or this guy:

Or even certain scheduled events like elections that one can see coming:

Now, one can stay out of the market during U.S. elections and I will probably do that. But for the other unforseeable events, it makes sense to limit exposure to the market to an amount that won't kill us to lose it.  And with the short duration trades we are using, there's not much chance of rolling or adjusting and I'm just not interested in doing that sort of trading anyway.

Since these sort of events are so rare, it's very likely that we'll be way ahead (600% or more, I hope!) before taking this max loss ...

This is a lesson I learned the hard way from earlier in my career.