I played poker systematically to learn how it would help with my trading. I only played small stakes but learned a lot. However, my talent is in the market and so you know are you going to work on your game or another game.
Specifically, I learned the following:
* Great odds often lead to large losses. One problem in trading is that you can't ever know if you were doing something "right" and the other trader got lucky or if you were flat wrong. The uncertainty makes it impossible for most to become successful discretionary traders.
Let's say you have a loss, you can analyze or over analyze it or decide it was a fluke. At end of day, nobody knows and nobody can say.
At least in internet poker, you can review the hand history and see if you lost with the best or worst hand. You can determine MATHEMATICALLY what your odds of winning were -- no if ands or buts.
When you lose several times with a 70% or 80% favorite in a row -- try 5 or 6 times then you will get a better appreciation for losing with great odds.
* It takes a lot of trials to get an idea for the edge you have. A stock trader will present 3-4 cases as statistically significant. It is not uncommon to need 10,000 or more hands in poker to get a true representation of the equity curve. In general, poker will teach you to discount a few cases or treat them with more suspicion
* Focus on strengths. I learned to focus on my strengths. I found the games I could win. This is the first rule of gambling.
As for patience, I found I did best in turbo games which didn't require as much patience. In general, you need to approach it with training mind for the stock market like I did. I no longer play nor have any interest in poker.
I was able to get consistently profitable in the lower stakes with a few dollars bankroll. I was really dominant player but the rake took most of my profits at that level. One thing I learned that I still use was that just being a dominant player doesn't lead to a steady rising bankroll. Focusing on the bankroll is more important.
One other thing that I learned is when switching from simulation to real money the primary reason for loss is a desire to avoid losses. For example, I was a strong sit-n-go player when I got like $10 to play at poker stars. I won my first sit-n-go tournament. I thought WOW my play money experience did translate to real money play- - which it it did*. However, I then became concerned and felt I could make my money last longer at cash games. That was a big mistake because I didn't play cash games. Eventually, I learned to play cash games and prefer 4 player or 6 player turbos.
So, you see the same thing in trading.. maybe you don't place a stop in the simulator then go live and start using tiny stops -- you'll get killed. The details are very important. You have to keep the simulation exactly the same as the real money environment.
It is actually easier to transition to trading from sim to real money then in poker though because in trading some fool will always call your bet. I don't know how useful poker was. I did learn a lot but it wasn't from focusing on the game but as a result of examining myself and my goals.
I was again a rather dominant no limit player. But, I couldn't read the board. I could read what it said my hand had and read the other players. Anytime I tried to play a book strategy and multi-table then I lost. But, I was strong heads up and in 4 or 6 player turbos. I never felt comfortable playing full tables -- maybe it was just my personality.
One of my favorite money makers was to find 1 person alone at a table. They might be sitting a 9 table and probably had multiple tables open. I'd start a heads up and bust them and take their money because they didn't have heads up play. Plus, I new they'd be distracted. But, it required discipline on my part.. find the lone player. bust him. and move on. If I stayed then I would be in a 9 player game where I didn't do well. The problem is that a lot of these players only had $1 or a couple dollar so I after busting them then I didn't make much. On other words, the poor players didn't carry much. SO, I made a lot more in turbos.
But, you see the thing wasn't that I was just saying I'm great at the game or even know the game. I found a small edge.. Found my strength and exploited it. But, in general I do not think poker is a good game or gambling either. Look at POker Stars they had billions so it is obvious where all the money was going.
Oh, one other thing I learned was to listen to my inner voice. After grinding all day then I got to point where I didn't want to play and in that state, I would always find a way to lose to make myself quit playing. So, I started paying real close attention to the voice in my head that said enough or quit. This is a good lesson.
One more key concept from poker is what I call the perception gap. That is that 2 poker players will see the same board and form a vastly different view of the odds. In the market, this is the basis for trade -- the perception gap. I mean that is how trade can occur.. so it is a very interesting concept and something I try to use to help me.
So there are some good issues.. you may find that you can't deal with uncertainty of market. I expect a lot of poker players couldn't deal with uncertainty of the market. But, I guess it depends on what type of player you are. i was 100% intuitive.. never knew any strategy.
Specifically, I learned the following:
* Great odds often lead to large losses. One problem in trading is that you can't ever know if you were doing something "right" and the other trader got lucky or if you were flat wrong. The uncertainty makes it impossible for most to become successful discretionary traders.
Let's say you have a loss, you can analyze or over analyze it or decide it was a fluke. At end of day, nobody knows and nobody can say.
At least in internet poker, you can review the hand history and see if you lost with the best or worst hand. You can determine MATHEMATICALLY what your odds of winning were -- no if ands or buts.
When you lose several times with a 70% or 80% favorite in a row -- try 5 or 6 times then you will get a better appreciation for losing with great odds.
* It takes a lot of trials to get an idea for the edge you have. A stock trader will present 3-4 cases as statistically significant. It is not uncommon to need 10,000 or more hands in poker to get a true representation of the equity curve. In general, poker will teach you to discount a few cases or treat them with more suspicion
* Focus on strengths. I learned to focus on my strengths. I found the games I could win. This is the first rule of gambling.
As for patience, I found I did best in turbo games which didn't require as much patience. In general, you need to approach it with training mind for the stock market like I did. I no longer play nor have any interest in poker.
I was able to get consistently profitable in the lower stakes with a few dollars bankroll. I was really dominant player but the rake took most of my profits at that level. One thing I learned that I still use was that just being a dominant player doesn't lead to a steady rising bankroll. Focusing on the bankroll is more important.
One other thing that I learned is when switching from simulation to real money the primary reason for loss is a desire to avoid losses. For example, I was a strong sit-n-go player when I got like $10 to play at poker stars. I won my first sit-n-go tournament. I thought WOW my play money experience did translate to real money play- - which it it did*. However, I then became concerned and felt I could make my money last longer at cash games. That was a big mistake because I didn't play cash games. Eventually, I learned to play cash games and prefer 4 player or 6 player turbos.
So, you see the same thing in trading.. maybe you don't place a stop in the simulator then go live and start using tiny stops -- you'll get killed. The details are very important. You have to keep the simulation exactly the same as the real money environment.
It is actually easier to transition to trading from sim to real money then in poker though because in trading some fool will always call your bet. I don't know how useful poker was. I did learn a lot but it wasn't from focusing on the game but as a result of examining myself and my goals.
I was again a rather dominant no limit player. But, I couldn't read the board. I could read what it said my hand had and read the other players. Anytime I tried to play a book strategy and multi-table then I lost. But, I was strong heads up and in 4 or 6 player turbos. I never felt comfortable playing full tables -- maybe it was just my personality.
One of my favorite money makers was to find 1 person alone at a table. They might be sitting a 9 table and probably had multiple tables open. I'd start a heads up and bust them and take their money because they didn't have heads up play. Plus, I new they'd be distracted. But, it required discipline on my part.. find the lone player. bust him. and move on. If I stayed then I would be in a 9 player game where I didn't do well. The problem is that a lot of these players only had $1 or a couple dollar so I after busting them then I didn't make much. On other words, the poor players didn't carry much. SO, I made a lot more in turbos.
But, you see the thing wasn't that I was just saying I'm great at the game or even know the game. I found a small edge.. Found my strength and exploited it. But, in general I do not think poker is a good game or gambling either. Look at POker Stars they had billions so it is obvious where all the money was going.
Oh, one other thing I learned was to listen to my inner voice. After grinding all day then I got to point where I didn't want to play and in that state, I would always find a way to lose to make myself quit playing. So, I started paying real close attention to the voice in my head that said enough or quit. This is a good lesson.
One more key concept from poker is what I call the perception gap. That is that 2 poker players will see the same board and form a vastly different view of the odds. In the market, this is the basis for trade -- the perception gap. I mean that is how trade can occur.. so it is a very interesting concept and something I try to use to help me.
So there are some good issues.. you may find that you can't deal with uncertainty of market. I expect a lot of poker players couldn't deal with uncertainty of the market. But, I guess it depends on what type of player you are. i was 100% intuitive.. never knew any strategy.
