Whether it's green baize or the trading floor, you can’t argue that the winners in poker and trading need to be ruthless. Whether it's bullying someone out of the game or doing all it takes to buy or sell at the right moment, there’s a huge range of tactics, strategies and tips needed in both disciplines, and only the strongest poker players and traders will have the right skill-set to make it to the top.
So what are the actual skills needed in both trading and poker? And how are they similar? We’re going to be taking a look at some of the strategies and tactics used by both sharks and traders, and how you can apply them when you’re trying to make some extra money.
If we could time travel, even just few minutes into the future, then we’d all be poker world champions and stock trading millionaires. Knowing the outcome of a certain situation would be the ideal way to never lose, but of course, we’re bounded by physics when it comes to knowing what’s coming next.
This doesn’t stop us from predicting and having foresight however, and in both games the best players and investors will be able to predict what’s happening next, sometimes with eerie accuracy, and then gamble on it. Take currency trading for example. Investors will be watching the currency they want to invest in, researching every bit of news about the trades, economy and political situations in the country of choice, then making a move based on both experience and the current situation. In some cases, they’ll get their prediction spot on, or close enough to make a profit. In poker, it’s even easier to predict the future.
Using odds theory, poker players can keep track of the cards that have been dealt so far, and start using well-trained memory skills to figure out what the likelihood of the next card might be. Professional poker players can sometimes do this so well, that they’ll know what all of the eventual outcomes of say, the last card in the river could be, helping them to make an informed decision on whether to gamble or not. The other way of doing this in a much more unethical way is by counting cards, but this is nigh on impossible to do when multiple decks are in play.
The next time you play poker, record a video of yourself and note down the times where you were dealt a good hand, and the times where you were dealt a bad one. You’ll be surprised to find that your expression, eye size and body language likely changed depending on the outcome. These are all know as tells, and can give away to your opponent how your hand is looking, allowing them to react to your reactions and bet accordingly.
Stock trading also thrives on shared information. The best traders will hear about outcomes before they’ve gone public, and will bet on stock rising and falling before the news outlets manage to broadcast information to the rest of the world. The best traders will try and squeeze this information out of their competition. Less experienced traders have been known to go out and celebrate a deal that hasn’t even happened yet, give away details, then the next day find out that the situation has changed completely because someone got wind of the deal and took advantage. This is where a thing or two could be taken away from decent poker players, who give away absolutely nothing about their hand at all times.
Some people like to play poker based on the hand they’re dealt. And some stock traders will pick a commodity or company that is performing moderately and back it. Not the professionals however. When everyone else is guessing, they’re playing 3D chess, thinking ahead several moves and using a mixture of intelligence and experience to win. Poker players will be targeting their most worthy opponents to get rid of ASAP, and traders will be backing something else should their other investment not come through.
Having a well-thought out poker strategy in place is the difference between having a bit of fun with the game and becoming very good at it. The same can be said for trading, if you have a backup, or you know exactly what you’re going to do next, risks become a lot less daunting and you can soon become way more efficient when it comes to laying bets.
Probably the most important parts of each game, both poker and trading superstars have big personalities. Go to any major casino floor where poker is being played and any major trading floor, and you’ll see the same; people shouting, screaming, pulling their hair out or just straight up bullying to get their own way.
Players like Phil Hellmuth and Mike ‘The Mouth’ Matusow have made careers out of being hotheads who jump down other players’ throats when the going gets tough, and you’ll find some stock traders who’ll do the same. Instead of pussyfooting around waiting for the right moment, they’ll act swiftly and with vast amounts of confidence, using their strength of character to either take an advantage or force their competitors by bluffing. Bluffing is more associated with poker usually, but telling your competitor one thing and doing something totally different certainly isn’t a new trick in the world of stock trading either.
Before you buy shares or lay down some serious chips at the poker table, you should consider how you can share your strategies between poker and trading, and also how to get better at both. Practice is the best bet you can make, and spending more time playing or trading online is a great way to make sure you’re using time effectively when it comes to putting the hours in. You’ll soon be showing off your new skills and leaving your opponents reeling.
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