Trading and Poker

There have been plenty of comparisons between trading and poker. Both are risky, high stakes, snap judgement games. Both require a good mental game. Both require skill to beat your opponents. The poker allusion has been enshrined in S&T books like Liar's Poker. What do you think about the similarities? Should I start playing a lot more poker if I want to pursue S&T?

 
Walkio:
Trading isn't gambling. Poker is.

Totally incorrect.

Poker is a skill based game with incomplete information. The individuals who make the best decisions and lead their opponents to make worse decisions are the ones who win in the long run.

Lots of traders are also poker players, or have left to become pro poker players (especially at SIG, where the game is very much a part of the firm's culture).

Learning poker at a high level of play is a good way to improve your decision making.

http://www.wallstreetoasis.com/forums/famous-poker-players-traders

 
Best Response

You will get split views on this.

Personally I think there are a lot of similarities between poker and trading.

Walkio: how you can say trading isnt gambling but poker is is beyond me tbh.

However, I would say a good trader usually makes a good poker player, but not necessarily the other way around. Mainly because poker is a game where the rules are defined and constant over time, whereas trading is a lot more open ended and unrestricted.

 
junkbondswap:
Not sure how often you play poker but if you truly understand the game and statistics you should be able to acknowledge the correlation between the two skill sets. Successful poker players and traders work with imperfect information to make calculated decisions to manage risk.

couldn't agree more with junkbondswap

 

you have to play in the long run to determine if you are actually successful or not-there is a lot, A TON I should say to poker theory. Start reading and playing.

I play on pokerstars.com

 

That global head probably wasnt a poker player or familar with the correlations. Duh

"Oh - the ladies ever tell you that you look like a fucking optical illusion?"

"Oh the ladies ever tell you that you look like a fucking optical illusion" - Frank Slaughtery 25th Hour.
 

not only that, there is a game theory aspect to trading when dealing with illiquid markets. like bringing your bets to a poker table with only 6 major players.

 

oh, yea. Poker is used at quite a few firms. I've been a professional poker player throughout college and it's the main reason how I've been able to interview at the majority of the top prop trading firms. SIG founders were professional poker players back in the day and Jane Street is run by ex SIG people that also use poker. I go to a semi-target school with a meh GPA. The quantitive skills are helpful but the pyschological skills I've gained are much more important to being able to become a profitable trader. It's a good stepping stone to use to help you decide if you can handle the trading lifestyle.

 

Wall Street Oasis private tourney on poker stars... Im feeling it Patrick. I mostly play big Multi Table Tourneys typically 1000+ players. VERE IS MY MONEY!? Mr. Son of a Bitch. Lets play some cards!

"Oh the ladies ever tell you that you look like a fucking optical illusion" - Frank Slaughtery 25th Hour.
 

I prefer NL Holdem and Omaha. I occasionally play cash, but I mostly tournaments. I play at PokerStars under this handle. I would certainly be interested in a WSO tourney, that would be fun.

Jack: They’re all former investment bankers who were laid off from that economic crisis that Nancy Pelosi caused. They have zero real world skills, but God they work hard. -30 Rock
 

Anyone successfully go from pro poker to trading?

I've been doing it for almost 2 years and am thinking I might only want to do another 1.5ish. This will have been my only work since graduating. I do play a lot and take it very seriously (made SNE on PS last year, 1st full year playing).

Suggestions for other things to do on the side? Books to read? Will firms give me a chance? Should I try for unpaid internships?

 

That's true..I guess I like poker so much only because I know I'm good at it and can make money. I don't have the same confidence about trading because I've never tried it. I also really like coding, so the main alternative career I'm considering is tech. The main thing I'm trying to figure out is which one I enjoy better.

"The code of competence is the only system of morality that's on a gold standard." - Francisco d'Anconia
 

Write an algo that you think will yield alpha. Backtest it, put on trades in a paper account etc. to document your findings.

CNBC sucks "This financial crisis is worse than a divorce. I've lost all my money, but the wife is still here." - Client after getting blown up
 

it is like poker, but that depends how you play poker. While all of the prop firms are looking for someone with a math/poker background, all they want is how you handle probability and decision with limited information, not actually how good you are in poker. Also, trading is much more than a 60 hour/week job.

 

Trading has very little to do with poker, barring teaching you logical thought processes, handling risk and avoiding results orientated thinking (right idea wrong outcome - losing AA v KK for example). Otherwise not much beyond that. Supported my way through college with poker.

 

Why don't you focus on the fact that you clearly have no interest in the markets. You think when you actually get to click the button you'll fall in love?

You need to be in love with the market's mentality and have a hunger for WHY things are being done, not the act.

Start looking at something else if you don't feel that attraction. It's nearly impossible to feign.

 

trading is "easier" than poker on the poker skillset but much, much more multi-faceted. especially as a junior guy, your success is largely determined more by your interpersonal skills than any stu ungar bullshit.

of course there is a base level of intelligence and savvy you need - to manage risk, know your pnl, not get picked off, blah blah but beyond that, it's MUCH more about how you manage your sales guys, clients, traders above you, back office, tech. the biggest impediment to your success is conveying the impression to guys around you that you know what you're doing, you have safe hands and you can absolutely handle more risk, no problem.

 

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