Stock Market vs Poker

[PoKeRFoRNiA]

I don't know if there's a thread on this, which I wouldn't be surprised if there is. But I find it very comparable. What do some of you guys think about stock market in relations to poker? They both require investment in hands, and they are both games where risk is involved but with skilled approach, one can profit over the long run. Only difference I see here is,

Poker is open 24/7. Stock Market is closed on Sundays.
Poker relies on player's history. In Stock Market, You can actually research corporations thoroughly about their history.
In poker, you can bluff. In Stock Market, you can't.
Mutual Funds can be equivalent to multi-tabling because you're invested in multiple places.
I think poker has more risk involved and variance involved compared to stock because skilled investors in stock market is like putting his money in with a set everytime.

Anyone care to discuss this or debate this? I just want to see how much similarities and differences there are between poker and stock market.

 

[icables]

My thoughts exactly

I was thinking the same thing when I made my initial deposit. I've heard though that only about 5%-10% poker players consistently profit. Let's hope stock brokers do better than that or else we'd be looking at the housing crash, dotcom bust, or etc again lol

 

[OzExorcist]

There's some similarities, and they're both gambling, but it's incredibly dangerous to go around thinking that being good at one will make you good at the other.

 

[biznizz]

yeah they both require a lot of study and some luck. I have thought about these two together also.

 

[TeUnit]

think they are very similiar ie roi, limited information, etc

 

[dj11]

In general, the Stock Market is not used for entertainment, poker is.

 

[sam1chips]

Negreanu has mentioned that when he views himself as a professional poker player, as opposed to viewing himself as a "gambler", he views himself as an investor and he is "investing" in himself

 

[PoKeRFoRNiA]

There's some similarities, and they're both gambling, but it's incredibly dangerous to go around thinking that being good at one will make you good at the other.

Well, yeah. That's equivalent to saying just because I'm good at roller skating, I'll be good at ice skating. But I think Stock Market and Poker have lot of similarities and have traits that are related. Some people such as Steve Begleiter worked for Bear Stearns before turning to poker.

Some differences I see also is, for stock market, you can have your money invested into certain stocks for years. with poker, it's hand by hand.

Both require heavy bankroll management. That's another similarity.

Another difference is, in stock market, there's no perceived image that you have to worry about. There's no "weakness" you have to worry about where stock market will exploit you. But with poker, you have perceived image and players can adjust and exploit you.

Both are extremely dangerous fields with lot of risk.

 

[Propane Goat]

I'm not a big fan of the stock market for these reasons:

1. Widespread use of algorithmic trading makes technical analysis mostly useless.

2. Accounting tricks, gimmicks, and flat-out fake numbers make fundamental analysis mostly useless.

3. One scandal after another where the big boys on Wall Street make bank by screwing the small investor and even many big investors: the dot-com bust, Enron, etc. etc. Many of those clowns were even betting against the same securities they were promoting during the housing bubble, thus making money no matter which way the market moved.

4. Massive amounts of printed money, easy credit, bailouts, and financial engineering increase volatility by huge amounts because big firms can ignore risk, they don't have any because it's shifted onto the taxpayers. The problem with this is that your retirement account may not be there when you retire. You notice that during the past few decades we have been lurching from one bubble and scandal to the next.

5. Many large corporations repeatedly look for short-term cost savings in order to meet their quarterly numbers, to the detriment of long-term company strength. Home Depot is a good example of this; when Robert Nardelli was CEO he cut staffing and salaries to the absolute minimum. The numbers got better in the short term, but the company also wound up having the worst customer service of any major retailer, which isn't a good recipe for long-term profitability. When this was going on, I remember seeing a new hire being assigned to the plumbing department...with absolutely no background or knowledge of plumbing.

Anyone is free to disagree with what I've stated here, maybe you have a different take on things and I'd love to hear it. Personally though, I much prefer to invest in assets where I have direct control.

 

[Loonbat]

When people used to refer to my poker-playing as "gambling", I would ask them if they invest in the stock market. I always considered it an apt analogy. The majority did invest (usually through a 401K). I would then share my poker return numbers with them ... over 20 thousand games played with a +30% ROI.

 

[loafes]

At the moment I know next to nothing about the stock market or how it works, I'd like to learn at some point though to see if I'm any good

 

[Marsd]

I don't know if there's a thread on this, which I wouldn't be surprised if there is. But I find it very comparable. What do some of you guys think about stock market in relations to poker? They both require investment in hands, and they are both games where risk is involved but with skilled approach, one can profit over the long run. Only difference I see here is,

Poker is open 24/7. Stock Market is closed on Sundays.
Poker relies on player's history. In Stock Market, You can actually research corporations thoroughly about their history.
In poker, you can bluff. In Stock Market, you can't.
Mutual Funds can be equivalent to multi-tabling because you're invested in multiple places.
I think poker has more risk involved and variance involved compared to stock because skilled investors in stock market is like putting his money in with a set everytime.

Anyone care to discuss this or debate this? I just want to see how much similarities and differences there are between poker and stock market.

you actually can "bluff" in the stock market--- take a look at the L2 and you will see orders pop in and out for some crazy numbers all the time--- the bluffing is just done differently, but it is still there---

There are some similarities I agree-

What I like about the stock market is you can make money whether its going up or down-- or staying flat-- not so much in poker-

Also its easier to research companies and invest some money into your own diversified portfolio... Easy money when you can set it and forget it type thing- Although you should be checking up on your investments at least quarterly.

 

[Marsd]

I'm not a big fan of the stock market for these reasons:

1. Widespread use of algorithmic trading makes technical analysis mostly useless.

2. Accounting tricks, gimmicks, and flat-out fake numbers make fundamental analysis mostly useless.

3. One scandal after another where the big boys on Wall Street make bank by screwing the small investor and even many big investors: the dot-com bust, Enron, etc. etc. Many of those clowns were even betting against the same securities they were promoting during the housing bubble, thus making money no matter which way the market moved.

4. Massive amounts of printed money, easy credit, bailouts, and financial engineering increase volatility by huge amounts because big firms can ignore risk, they don't have any because it's shifted onto the taxpayers. The problem with this is that your retirement account may not be there when you retire. You notice that during the past few decades we have been lurching from one bubble and scandal to the next.

5. Many large corporations repeatedly look for short-term cost savings in order to meet their quarterly numbers, to the detriment of long-term company strength. Home Depot is a good example of this; when Robert Nardelli was CEO he cut staffing and salaries to the absolute minimum. The numbers got better in the short term, but the company also wound up having the worst customer service of any major retailer, which isn't a good recipe for long-term profitability. When this was going on, I remember seeing a new hire being assigned to the plumbing department...with absolutely no background or knowledge of plumbing.

Anyone is free to disagree with what I've stated here, maybe you have a different take on things and I'd love to hear it. Personally though, I much prefer to invest in assets where I have direct control.

Im curious- What assets do you invest in?

I do think it's smart to have other investments, but I think it would be unwise to not have anything in the stock market as part of your entire financial plan.

in regards to what you are saying, although there is truth to it I think it's still smart to invest in the market-- just dont put all your eggs in one basket--

history has shown that there will be downturns, but overall the market has continued to grow-- I would make a bet that it will continue to grow for as long as we are alive to see it--

There will be downturns, but it always bounces back-- Just be smart with where you invest it and you will be able to recover the downswings--

Now, I'm just talking about someone that is long the market here-- easy invest it and forget it type stuff, like most 401Ks-- if you are smart enough and good about saving some cash for the downswing then you can buy up cheap stocks when markets tank and reap the benefits.

I think its smart to invest in a wide variety of "assets" -- stocks is one of them for sure-

 

[WEC]

One thing both the stock market and poker have in common, between 80-90 of the people who participate in the endeavors lose money overall doing so...

 

[Akorps]

Based on long experience, too many people don't understand the risks inherent in the stock market, and start gambling. If you are smart you can make money.

 

[loafes]

Based on long experience, too many people don't understand the risks inherent in the stock market, and start gambling. If you are smart you can make money.

This sounds an awful lot like poker if you ask me, perhaps there are similarities after all

 

[PoKeRFoRNiA]

In general, the Stock Market is not used for entertainment, poker is.

To business people, stock market is an entertainment as well. Lot of people do stock market as hobbies outside of their career because just like poker, it's a place where you can do way more than tripling your money within short period of time.

 

[bernotas22]

stock market kind of reminds me of poker staking, except to me the stock market is more like a ponzie scheme...

 

[jordanbillie]

The stock market is a great place to start making your poker earnings work for you. I originally became fascinated with investing and was overly active. I was over trading, and losing out on big gains. I could go on and on about the specific stocks I sold too soon and cringed when I saw them double/triple within the next coming months.

After a couple years of experience, I have realized that the stock market is a great place to invest, with the goal of slow consistent growth. You will most certainly not make money as quickly as you would playing poker, but for the most part, investing in the stock market will not require much of your attention and time. I have a very traditional approach to investing and quite honestly I have been doing very well.

There are definitely similarities between poker and investing in the stock market, but like Oz said, it is very dangerous to think that you will be good at something just because you succeed at something else similar. Take your time, do your research and make sure you believe in the companies you invest in.

 

[Macaroon]

I'm not a big fan of the stock market for these reasons:

1. Widespread use of algorithmic trading makes technical analysis mostly useless.

2. Accounting tricks, gimmicks, and flat-out fake numbers make fundamental analysis mostly useless.

3. One scandal after another where the big boys on Wall Street make bank by screwing the small investor and even many big investors: the dot-com bust, Enron, etc. etc. Many of those clowns were even betting against the same securities they were promoting during the housing bubble, thus making money no matter which way the market moved.

4. Massive amounts of printed money, easy credit, bailouts, and financial engineering increase volatility by huge amounts because big firms can ignore risk, they don't have any because it's shifted onto the taxpayers. The problem with this is that your retirement account may not be there when you retire. You notice that during the past few decades we have been lurching from one bubble and scandal to the next.

5. Many large corporations repeatedly look for short-term cost savings in order to meet their quarterly numbers, to the detriment of long-term company strength. Home Depot is a good example of this; when Robert Nardelli was CEO he cut staffing and salaries to the absolute minimum. The numbers got better in the short term, but the company also wound up having the worst customer service of any major retailer, which isn't a good recipe for long-term profitability. When this was going on, I remember seeing a new hire being assigned to the plumbing department...with absolutely no background or knowledge of plumbing.

Anyone is free to disagree with what I've stated here, maybe you have a different take on things and I'd love to hear it. Personally though, I much prefer to invest in assets where I have direct control.

Absolutely correct. I've done both. The stock market is now pretty corrupt - lots of insider dealing and companies' accounts useless for estimating how good the company is. One UK carpet company went under and it was discovered that every order they had was treated as a sale...even if the order was then cancelled! In addition share prices are manipulated by orders which slowly force the price up or down, encouraging people or computers to suddenly start selling or buying, and then a killing can be made.

Mind you, trading is greater fun than playing poker as it's much more varied - I did it through CFDs (Contracts for Difference) with direct entry into the market. But you can do it only during trading hours. You can gain entry into foreign markets of course to extend the hours but that's risky for an amateur unless he has expert knowledge in some field.

Spreadbetting the currencies is also great fun and doesn't have to cost a lot and is what I would recommend for anyone starting out - that can be done on a technical basis most of the time - graphs, averages etc, although understanding the political implications is also a help (I just did the technical stuff).

However I do not do any trading now as it does require constant study - every day you need to check what's happening in your specialist field. Poker is easier and even if you're bad you can do it without losing a lot. Trading shares requires you to put more at risk.

 

[bernotas22]

i would rather invest in rental homes than in the stock market at least then i know im not involved in the ponzie scheme that the stock market is