Full Tilt Options Trading

• Posted by Adam Warner
• on November 24th, 2009

Hey, here’s a new, underpublicized concept. There’s a similiarity between poker skill and investing/trading skill.

Brandon Adams, who teaches behavioral finance at Harvard University’s Department of Economics, says some of the best candidates for Wall Street trading jobs are the professional card players at FullTiltPoker.com and similar Web sites.

“They’ve essentially been the survivors in the system, a very difficult system where 95 percent of people lose money,” the 30-year-old Adams, who plays at the site, said in a telephone interview. “Anyone smart enough and disciplined enough to survive that system is probably going to do very well in the trading world.”

An increasing number of hedge funds and brokerages are scrutinizing professional poker to find talent and analytical tools, according to financial recruiters including Options Group, a New York-based executive-search company. Susquehanna International Group LLP, the Bala Cynwyd, Pennsylvania-based options and equity trading company, uses poker to teach strategic thinking.

…..Susquehanna has been using poker to teach its new traders since it was founded in 1987, said Pat McCauley, who heads the privately held firm’s trader-development program.

Hmmm. I started on the AMEX in ’88 and hung out with some Susquehanna traders and clerks back then, and played poker at their office a few times. Guess in hindsight they were gaming me, lmao.

There are simillar themes to poker and trading, certainly the math, and comfort and speed with the whole pot odds concept. And yes, you have to know when fold ‘em. But it’s also way different. There’s not an awful lot of reading “tells” in trading, or much bluffing in general. I mean you don’t pretend you’re going to take down 10,000 calls to induce the broker to fold his order. And you don’t (I hope) manage money the same way. It’s one thing to go all in when the odds are in your favor (or you’re bluffing) but you really want to trade like that? It’s almost the exact opposite, you want to be here for the next trade, not go broke on a bad beat.

So sure, there’s some overlapping skill set, but you can say the exact same thing about Chess, Bridge, Backgammon, Crossword puzzles, et. al.

The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

blog comments powered by Disqus