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MiS Preprint

Adaptive Bet-Hedging Revisited: Considerations of Risk and Time Horizon

Omri Tal and Tat Dat Tran


Models of adaptive bet-hedging commonly adopt insights from Kelly's famous work on optimal gambling strategies and the financial value of information. In particular, such models seek evolutionary solutions that maximize long term average growth rate of lineages, even in the face of highly stochastic growth trajectories. Here, we argue for extensive departures from the standard approach to better account for evolutionary contingencies. Crucially, we incorporate considerations of volatility minimization, motivated by interim extinction risk in finite populations, within a finite time horizon approach to growth maximization. We find that a game-theoretic competitive-optimality approach best captures these additional constraints, and derive the equilibria solutions under various fitness payoff functions.

Apr 8, 2019
Apr 8, 2019
adaptive bet-hedging, Kelly gambling, game theory, growth optimal portfolio theory

Related publications

2020 Journal Open Access
Omri Tal and Tat Dat Tran

Adaptive bet-hedging revisited : considerations of risk and time horizon

In: Bulletin of mathematical biology, 82 (2020) 4, p. 50