10k post

[ahnuld]

meh, I dont really agree with that iceman. You dont want to be forced to sell your stocks because of a downswing, and its very hard to get money online nowadays. If you can get it back online quickly, I dont see why a money market fund that pays 4-5% on cash couldnt be used but I dont recommend putting your roll into anything less liquid than that.

[iceman5]

Sure you could use a money market or online savings account that pays 5%, but Im talking about long term.

Lets take a case like mine. I play signifcantly overrolled. My roll is big enough to play 25/50 NL but I dont because, well, Im probably not good enough. So, I have a large chunk of money that is technically part of my roll that used to just sit there doing nothing.

I invested a large portion of it and continue to invest 50% of my winnings each month.

Im sure there are other people in similar situations. Lets say you have a $20K roll. You are beating $200NL easily and have tried $400NL, but havent done well and / or dont like the variance. You are way overrolled for $1/$2 and dont plan to move up for at lest the next 6 months. Why not invest a large portion of your roll?

If you are beating $200 NL, you will quickly win enough to build the non invested portion of your roll up to the point where you can take another shot at 2/4 if you want to.

If you arent comfotable with that approach, you should at least be taking some percentage of your winnings out each month and investing it for the future. Even if its only 10% or so, you should be investing something.

[mak15]

So I'm a senior at the wharton school and currently interveiwing for analyst jobs with hedge funds and trading jobs with banks so while not an expert i probably have some perspective on finance. I wanted to write something more substantiave but couldn't really come up with how I wanted to word it and don't want to argue too much about finance so I'll just say:

I think everyone in this thread is being a little too optimistic about their ability to beat market rates. You all realize that brilliant men with many years of experience who are paid milions to run hedge funds still don't beat index funds in a large number of cases?

I also don't know how people are using the word "trading" in this thread but to me "trading" means moving in and out of positions quickly and not because you think the stock is a good one but because you think you can buy some of it now and then sell it within the hour for a couple pennies more. If this is what other people mean, then I am going to again say I thnk people are way overestimating their ability to make millions in this field. Yes, there are a lot of similarities in the skill set of a good poker player and trader, but if you are trading for yourself and are up against people with all the resources and knowledge of a large bank you may find it not so easy.

I didn't really say much in this post I guess. I just want to warn everyone that counting on being able to trade or invest your money after poker isn't really a good back up plan in most cases. No offense to ahnuld of course who may very well be able to make enough in poker the next three years to "retire" on getting a few points above market which he may be abe to get.

-mike

[iceman5]

Where did someone say they could make millions trading?

Investing your money for the future when you may or may not still want to play poker is absolutley a good plan. Nobody here is claiming to be the next Peter Lynch, but even if youre just investing in index funds, its a good idea to invest in something.

[ahnuld]

mak15,

I addressed most of your points already in my OP,

"Passive income is not the way to make the most out of your money however, as active management in the stock market can earn you significantly higher than average returns. This is very difficult to do however, and is not recommended for 99% of investors. The reasons are numerous but the most important is the time required to do "your homework" thoroughly. "

This was meant to imply that yes, beating the averages is extremely tough, but it is doable, much like winning at poker is tough but doable. Also, I understand what people mean by trading even if they are using the term somewhat incorrectly.

[mak15]

[ QUOTE ]
Where did someone say they could make millions trading?

Investing your money for the future when you may or may not still want to play poker is absolutley a good plan. Nobody here is claiming to be the next Peter Lynch, but even if youre just investing in index funds, its a good idea to invest in something.

[/ QUOTE ]

Obviously I agree 100% in investing money. The thing that worries me is the posters who say, not just in this thread but in all these types of threads outside the fnance forum, their (backup) plan after poker is to invest their own money. That really isn't a career and isn't going to generate wealth on its own.

I just read through the thread quickly, but I am pretty sure at least some posters are talking about being "professional" investors.

[mak15]

Hi Ahnuld,

My post wasn't really aimed at you as your OP shows a lot of understanding and it is clear you know a decent amount about all this stuff, probably more than I do. I am more concerned about the oher posters who may get the wrong idea since I think we can all get carried away thinking how easy it is to make money since we've all made so much with relative ease in poker.

also, the trading comment really stems more from discussion on tradng i've seen in these forums in the past rather than in this thread, but figured it was still relevant.

Anyway, this is a great thread and i'm not trying to be argumentative. I hope poker stays profitable forever and we all make millions in the markets, I just think we should be sure not to be overly optimistic.

[recallme]

Will you make a new thwead fo the next topic?
N1 post by the way, it`s in my favorite list!

[XCEO]

Nice thread!

One quick question: I hear people say that the advantages of real estate investing is that you can leverage. However, is it possible to get a loan without a stable income (poker)? I'm quite sure that this isn't possible in The Netherlands, even if you have enough money on your bank to guarantee the loan.

In my view, the best way for a pokerplayer to invest is to split your money between: an index, bonds and only a small part in more risky instruments (ONLY if you know what you are doing). Stockpicking is not easy and very time consuming if you want to do it right (you should devote your time to playing poker!) and even then absolutely no guarantee to beat the market (I guess 99% individuals don't beat the market).

I also think it's pretty much -EV to devote time to real estate (this is the case for people who earn a lot with poker). Except if you really like it (hobby?), it is too time consuming and has zero guarantee to perform better than just putting your money into something like treasury bonds.

Summary: spend your time earning lots of money with poker and put that money in a passive portfolio.

[john kane]

brushing your teeth is a good investment.