Trading and Professional Poker


I have been mesmerized lately with the similarities I see between professional poker, professional blackjack players, card counting, and gamblers math and our beloved profession of trading.

The more I study, the more I believe they are more similar than not and that there is a ton to be learned from these guys when it comes to the way I trade. So much so that I have stopped trading all together in an effort to immerse myself in this idea.

I am going to keep this short today but know that I have plans to write fairly extensively about this idea in the very near future and am working on a spread sheet that, when complete, may allow me to “count cards” in my trading.


The Similarities:

1. Professional poker players play each individual hand on its own probability. No trend, no range. Each two cards dealt have their own set of probabilities and those probabilities change every time a new card is exposed, whether through the dealer, or through an opponents exposing them.

2. In Blackjack, card counting increases awareness of probabilities for certain events happening and a card counter knows when these probabilities are in their favor, and when they are not.

3. Gamblers math is the exact same theory of money management and risk and reward that traders talk about all the time. What professional poker players are able to do that most traders can’t is find that place of high probability and then make it pay. That way, they never try and force mid or low probability situations to have to pay more than they should.

I plan to make the case that trading is knowable the same way that professional poker is knowable; by being a student of the probabilities.

Here is something to think about today:

Why can professional poker players guess with regularity the cards in their opponents hands? Can traders do the same thing?

Would love to hear your thoughts on this in the comments section.



Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s