Sunday, January 29, 2017

If it works for poker, it should work for investing...


More money is lost by players who know what the right thing to do is, but don't do it, than for any other reason. Having a strategy, a game plan and the discipline to stick to it are, along with a sufficient bankroll, the four most important thing that a player needs to be a winner. 
- Ken Warren poker writer on Texas Hold 'Em

Poker is a game. You play the odds. You play your opponents. You manage the risk, size your bets, and control your funds. The hard part is sticking to the plan in the face of losing and not letting the other players or your recent performance dictate your behavior. This is the discipline necessary for success.

The same applies to investing even though the markets will be tougher game. The nice part of any poker game is that the rules of the game are known. The players are limited and betting occurs with set bounds through turns. Investing is more difficult and thus requires even more discipline. There is more noise, more uncertainty, and more ambiguity even on what are rules being played. In this case, the only way to prevail is to change the dynamics to make it more structured through your own controlled behavior.

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