It's time for poker players to start putting their money to work. - Page 3

Scorpion Man · #21 09-04-2006, 01:06 PM

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Whay do you want to do this scorp? It seems like it would be much less lucrative than, and would involve more tedious work (with less time to deal with the actual investment process) than a typical hf pm type role. Am curious.

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I can't speak for the OP, but I'de assume that if he's retired in his late 30s he isn't very concerned with making money and more with doing something that he views as fun and helpful.

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This is basically true. Doing something like this would earn about 1% of what you can earn being a successful HF manager. I have not been looking for a "job"...but I have been thinking about ways to do something related to either hedge funds or poker that would be engaging.

I also enjoy helping people, in particular if the people are smart and interested.

This has been the germ of an idea...whether I can execute on it in a way that makes sense, I am not sure.

My other challenge in answering some career questions of the "how do I get into this" genre is that I went about things in a certain way. When others have different backgrounds, I am less certain how to advise, because certain avenues that were open to me might not be open to them as a result of choices people have made along the way.

I am happy to continue this discussion and give people a hand if they are interested.

The original question was trying to tap this forum to understand if there are a lot of people out there like my cousin...earning 6 figures, having 6 figures in the bank, and really having no idea what to do with it or how to approach their financial lives (like the athletes we discussed earlier).

Thanks for reading.

sef · #22 09-04-2006, 02:01 PM

I am like the type you are describing, yet I have at least some basic idea on how to approach my financial life (at least I hope so lol). It is true, however, that it would take tremendous amount of time for me to acquire good knowledge of investing theory and practice. I play nearly 100 hours per month as I think currently my time is better spent playing than analyzing finance. Earning six figures per year is my priority this year, but I can see that I could be making some money just with smart investing and (very) slowly retire from playing.

Since now, I have been investing in mixed mutual funds (half equity/half bonds) and little 100% equity funds. I realize that I should be probably pursuing a more aggressive approach. I would be very interested to get in touch with you and get some good advice.

Thanks

#23 09-04-2006, 04:51 PM

kidpokeher · #24 09-04-2006, 05:39 PM

I like the idea. Plus I need a place to hang my 7 before it expires. To build trust and establish a good rapport you could align the incentives by charging a fee based on the growth of customer assets. We don't make money unless you make money, so to speak. Could revolutionize the industry.

mwgr5 · #25 09-04-2006, 06:18 PM

This is a very good topic. I think one of the general problems is the young age of most poker players. Mentioned earlier, most players are younger than 25 years old. I bet this age demographic in general, not just poker players, has little investing knowledge. Most young people know what investing is but don't know how or where to invest money.

Also, I think it is key to stress that investing can be simple. People don't have to research individual stocks or make frequent trades. A young poker player could simply buy and hold a total US stock market index, total international stock market index, and total bond market index and have a completely diversified, low cost portfolio. Investing in a target retirement fund is also a simple solution for a young investor starting a Roth or Regular IRA. Investing does not have to be complicated to be successful.

Scorpion Man, I am 18 and have been investing since I was 13 and am very interested in learning more about buying individual stocks. I am also very interested in the hedge fund and trading industries and wonder how to best position myself for a job in those industries. Could I pm you with more info and questions?

Scorpion Man · #26 09-04-2006, 06:36 PM

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Also, I think it is key to stress that investing can be simple. People don't have to research individual stocks or make frequent trades. A young poker player could simply buy and hold a total US stock market index, total international stock market index, and total bond market index and have a completely diversified, low cost portfolio. Investing in a target retirement fund is also a simple solution for a young investor starting a Roth or Regular IRA. Investing does not have to be complicated to be successful.

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This is all true. You are wise beyond your years. Feel free to PM...

mscags · #27 09-04-2006, 06:40 PM

Scorpion,

I am a junior in college, 21 in a few months, with a major in Early Childhood Education and minors in Math and Spanish. Currently I have around 5K I would like to invest. I make a nice amount of money from poker (for a college student at least) and am very interested in getting into investing. If you were me what kind of things would you be doing? Thanks for the help.

Mike

#28 09-04-2006, 07:22 PM

goosinator · #29 09-04-2006, 07:30 PM

This is good2cu posting on a friends account because I'm currently banned from 2+2.

Scorpion Man -

I am 19 years old and have been playing poker professionally for 6 months. I will probaly around 300k this year unless I hit a big tourney score. I currently have a liquid net worth of 150k, most of which I need for my poker bankroll. I currently have 10k in ingdirect, and 25k in vanguard funds. 12k in Emerging markets index funds, 5k in a SP500 Fund and 8k in an Internal index fund. I plan on adding a small cap US stock fund and adding 10k evenly to each fund every month. I have very few expensives beside the lavish trips I take and all the money I spend at clubs (have to live life). What would you suggest for me? How should I go about filing my taxes (I have never paid taxes before), will any CPA be fine?

Scorpion Man · #30 09-04-2006, 08:20 PM

Hmmm.
1) Do your parents have an accountant that is any good? I would start there if they like him. If not, network through friends here to get a guy who has done a lot of work with poker players. There is no substitute for experience in terms of making the right decisions around tax reporting. You are doing the right thing paying them, btw.

2) Sounds like you are doing a good job dollar cost averaging. As you hopefully know, you are taking the high risk approach with your selections. (I assume by "internal index fund" you mean "internet index fund"). As a % of your portfolio, it is pretty unusual to have this kind of allocation to emerging markets and internet stocks...on the other hand, you are young, you are earning a bunch, and your portfolio overall is a relatively small piece of your net worth. So you can handle that swing. Just pointing out that this is not a prototypical portfolio and is higher beta (meaning risk) than most.

It's a really good start and it would be fine if you never did much more than would you are doing, although I can't see keeping that allocation over time as your portfolio grows, in particular because I doubt you have any real reason for being in emerging markets other than that they sound sexy.