Experienced Financial Investor Bob Frick Offers His Best Poker Tips

Recently, Kiplinger’s Financial Magazine ran a series of fascinating articles drawing  parallels between high stakes gambling and the world of big money stocks and shares investing. A poker player’s hole cards could be considered a potential investment, the article continues, with decisions whether to buy/bet or sell/fold becoming clearer as more community cards are dealt.
One of the most interesting ideas asserted by Kiplinger’s Bob Frick, was that controlling emotions was a vital key to success in both fields, and that playing poker provided a means by which to recognize and avoid the emotional traps that invariably occur.
Frick uses Daniel Negreanu’s quote that “having emotional stability and emotional control is key to both investing and poker,” to back up his claim, and goes on to explain that, “just a few hours of playing poker will take you through literally dozens of financial decisions.”
Frick then sets out five key areas which present major pitfalls to players/investors, which offer negative expected value (EV), and will cost money to poker player and investor alike, in their respective fields. These he identifies as Greed, Overconfidence, Regret, Seeing Patterns, and Holding on to losers.
The problem with Greed, he says, is that, “the possibility of that big payout can blind us to thinking logically about our odds of winning,” which reminds us not to get attached to good hands or investments, which have fallen behind in value.
The dangers of Overconfidence are clearly shown by economics graduate and poker pro Vanessa Rousso, who commented that, “in tournaments when I’ve won a series of hands, it tends to make me loosen up and take excessive risks.” The message from Frisk is not to allow fluctuations in luck to affect your logical game plan.
Concerning Regrets, Frick says, “a big loss causes regret, which can lead you to take big risks or to unload your securities and stay out of the market for an extended period.”
The dangers of holding on to losing investments too long is compared to getting married to a big pocket pair or a flush on a paired board, with your opponent demonstrating a great deal of strength.
The discussion on Seeing Patterns can best be summed up by the investment legend, “past performance is no indication of future returns,” and that in poker you can override instinctual and emotional logic by calculating odds, while in investing you should “check the five- and ten-year histories, not just how a fund has done the past couple of years. And do some in-depth analysis. Look at things such as fees, turnover, fund size, manager tenure and so on.”
Bob Frick’sarticle is a fascinating look into the overlapping worlds of poker and investment, and will provide invaluable insights that could improve your performance in both fields.

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