I played poker just as a test to see what it could teach me about trading and yes with real money. It was a test to see how real money would influence my decision making. I became able to grind out a steady profit in poker. I developed a "poker read" like my market read.
I think trading is a much more pure game then poker. I guess trading suites me where poker didn't even though I could win at it..
First, you can't 100% rely on play money poker like with trading because without risk people will call your bets more often. I played with play money for about 6 months. It doesn't mean you can't get many of the skills required. You can get about 60% to 80% of the skill required with play money.
I never even learned to read the deck. I use color deck only. I learn to read the players!! I rely on the "help" feature to tell me what I had. I lost *a* lot of times with great odds in poker. I never really liked poker. It was only something to win at but I didn't like it. I enjoy calling the market. It is not just winning.
My take is that the edge in poker is much more random then in trading but it is possible to make more money (for some) because there are more games to play then in trading. The biggest lesson I learn from poker is just how much I could lose with great odds. I never thought I could lose so many times with great odds.
I also learn that if I just kept playing I lose it all. I was dominating at micro stakes. Biggest pots I played were maybe $20 or $40 pots. I played no limit. Remember, it just a simulation for me to see if it would teach me anything about trading. But if I didn't protect my bank roll then I lost.
I know some professionals who claim it is possible to grind out a living with a 10k bankroll. It would be harder to do this trading. However, also, most of these poker players no longer play. So it may have been a thing "as once and done". The players online these days are much better.
Winning in poker -- as trading -- is about sticking to strengths. I found I couldn't play a lot of games. For example, I couldn't play 9 handed because I didn't have the patience. I thought if I played turbo games that I'd be more prone to gamble but I found I could play those turbo games and win on them because I could get a read on each player better due to the increased number of cards.
One thing also with poker, you will play many more hands. So you will see more rare probabilities. Many stock traders never place enough trades to really understand the volatility of the returns. If you ask a poker player how sure he is with 70% odds then he would say "not very sure" but a stock trader would think it was a sure thing. So, it did teach me okay yes I can lose a lot with great odds.
One memorable series of hands, I had pocket aces/kings like 3x in a row. First, I tried a big raise and everyone fold. Then I got it again and thought no one will believe me I got it again so I went all in. No calls. Finally I got the kings and went all in again and I got called by the aces and lost the pot.
... One more thing though the rake is much more severe in poker then in trading. Anything at the $5 to $20 level is just going to go to rake. I track an equity curve of my winnings before rake and it went straight up.. after rake just middling up.
... One more thing, Billy Walters was/is a legendary sports gambler/arbitrager. You'd think they made 1000% per year but the reported income from their "system" was only 10% per year. Who really knows what the good (high net worth) poker players are doing net % per year.. might be less then you'd think.
... One other thing, with trading there is no cost of not taking trades (of course there is a small for not being in the market but that is irrelevant unless it is predicted) whereas in poker there is a higher cost of being in the game. This may explain some of the variance.
It is like when I'm reading the market well.. it is kinda like Jack says, I can predict every turn. I could make a huge amount. But I don't take every opportunity. In other words, I'm not optimizing toward NET PROFIT but RISK/ADJUSTED return.
If I were to "take every trade" with some measure of my skill then my net return would probably soar beyond anything I could imagine but I'd also have steeper losses then anything I would imagine too...
I think this may actually explain a lot of it. It is a thought for me for me try to do.. as an experiment.
