Kiplingers: Playing Poker Can Make You More Successful
Pokerati.com had an interesting report on how Kiplinger's Magazine featured a three article series on poker and how playing the game helps individuals become more successful.
How Poker Can Make You a Better Investor discusses how playing poker can help one to recognize, and hopefully avoid, emotional traps that endanger the most important stack of chips - your portfolio.
The psychological issues that drive investing and gambling decisions aren't merely similar. They are "identical," says Andrew Lo, director of the Massachusetts Institute of Technology Laboratory for Financial Engineering and one of the leaders in the field of behavioral finance (listen to our podcast with Lo). It's easy to find investment professionals and professional poker players who agree. Says poker pro Daniel Negreanu, who holds four World Series of Poker bracelets and two World Poker Tour Championship titles: "Having emotional stability and emotional control is key to both investing and poker."
Can you gain that control at a poker table? Aaron Brown is among many who think so. Brown is a onetime finance professor and former portfolio manager for Prudential Securities who is now a risk manager for hedge funds. He's also the author of The Poker Face of Wall Street (Wiley, $17). Says Brown: "People tell me playing poker is risky. Investing for a financial lifetime without playing poker is risky. I'd much rather make these mistakes at the table."
And by mistakes, Brown means the common emotional errors that plague investors.
How Texas Hold'em Stimulates Investing looks at looks at how Texas hold 'em involves many decisions per hand. "The stock market and Texas hold 'em are games of investing based on incomplete and unfolding information," says Frank Murtha, a behavioral-finance consultant with a PhD in counseling psychology (his dissertation explored the effect of psychological errors in gambling). "The goal of each is to accumulate wealth by making decisions based on that information."
And then there is How Deepak Chopra Helped Me Play Poker Better. The reporter hooked himself up to a device to measure how excited he would become while playing poker.
In one exercise, a ball rises as you experience stress. You try to lower the ball through simple breathing and relaxation techniques. My resting heart rate is about 60 beats per minute, and it would rise to 90 or more when my poker-stress level rose. So before playing, I relaxed and dropped the ball as best I could. Then I joined a poker table. Sure enough, if I had a great hand, or if I got in a betting battle with one of my on-screen opponents, the ball would rise, sometimes dramatically.
Patrick Flanigan, Gambling911.com
