I started doing a lot of research on topics related to trading. Greg from http://www.youtube.com/user/SCOPELABS was talking a lot about learning from Poker players, so I bought “The Godfather of Poker” from Doyle Brunson, in a remarkably well equipped Poker and Gambling books section of Borders in Boston.
My key area of interest is: Which key learnings from gambling can be transferred to trading?
Let me summarize a few key observations from crawling through this 400 page autobiography.
It is all about bringing your A-Game to the table/trading every day, for every game/trade. Preparation, especially understanding your opponent’s strengths and weaknesses are critical. Don’t just put the money in the centre of what you do, focus on the competition. Gambling and trading are both zero-sum-games and a dollar/pip made in your bankroll/account is a dollar/pip lost for somebody else. Interestingly, very successful Poker players, play highly aggressively. Doyle Brunson summed it up in his key statement: “You gotta give action to get action”. This is counterintuitive for risk/money management strategies but I would argue that after you have done your homework, and given you adhere to your risk/management rules, being too passive doesn’t get you anywhere. A professional poker player would get in earlier, with a more aggressive position when they see the right setup/hand of cards.
Key lines from the book:
- “You gotta give action to get action”
– Doyle Brunson, Poker World Champion
- “Gambling isn’t the money. It’s the competition. It’s laying your ability on the line and inviting challenge. That’s what I take pride in – being a winner”
- “Poker has a language all its own, but you don’t expect most folks to understand it, any more than you expect them to understand Egyptian.”
- Puggy Pearson, Poker World Champion.
- “Never follow an empty wagon.
- Every man is honest – as long as he can afford it.
- Believe in Justice. But spell it “Just Us”
- “The only bad luck in life is bad health. Everything else is an inconvenience.”
- Benny Binion, Poker Legend and Owner of the Horseshoe Casino in Las Vegas.
- “I am not smart but I recognize talent. I try to surround myself with smart people”
- “Tough times make tough people”
– Jack Binion, Horseshoe Casino Las Vegas
