It’s a fact that many of the worlds top traders are either good poker players or came from playing poker to Forex and the reason they are so good at Forex trading is the skills of poker are very applicable to trading and there is much you can learn…
It’s a fact that poker players tend to make far better traders than geeks or nerds and that’s because, they see Forex for what it really is – a high stakes game where simple systems applied with discipline, are more robust than complicated ones.
Lets look at the key areas you can apply poker skills to trading.
1. Forex and Poker are Games of Odds NOT Certainties
Many look for some hidden order to price movement and create complex theories they think will work but they break in the brutal world of trading, as prices only move to the odds and not to certainties and this means waiting for high odds set ups and taking losses and keeping them small, until high odds trades emerge.
2. Responsibility for Action and Confidence
Most traders try and follow others or buy a robot and think they will make money easily. The good poker player though knows when he sits at the table he is on his own and responsible for his results and no one can help him. He has confidence in what he is doing, because he has learned all the skills needed and doesn’t rely on anyone but himself.
3. Discipline and Money Management
Most traders can’t take losses and keep them small and can’t trade with discipline but you have to manage losses with discipline, to win long term in both Forex and poker.
The good poker player will pass hands by and fold and cheerfully lose, as he knows he must keep his losses small and wait for the right opportunity. He has confidence a high odds hand will come, he just needs to preserve his chips until the time is right.
4. Courage and Conviction and Bet Size
Most traders even when they get a big trend can’t make the most of it. They bet too little and take profits to soon as they lack confidence in what there doing and courage to bet big. The poker player on the other hand, will bet big and have the courage, to see the hand through to the end and make as much as possible from it.
5. Focus on Making Money not being Clever
In Forex trading you are not judged on how clever you are and how hard you work you are judged on the profits you make and thats all. If you want to be clever do something else. Forex trading is a combination of a simple method applied with confidence and discipline with one aim making money.
Confidence, Courage and Discipline = Success
When a poker player sits down he is out to win, he has no ego and takes his losses and knows they must be kept small – he has to lose to win and knows that he then, has the courage to hit high odds hands and maximize his gains. All these traits come together, to see a huge number of poker players emerge as super traders.