Don't compare poker with investing
usnook | 2013-07-31 10:59

Some Main Event entrants are boldfaced names, including Doyle Brunson, Antonio Esfandiari, and a statistically improbable number of pros named "Phil". Most Main Event entrants, however, are bucket-list amateurs, perhaps a few of whom have sold 16 shares of Apple to afford the $10,000 entry fee.

With so many people playing poker or watching it on television, it's become fashionable among professional investors to compare poker with investing. First, there is the obvious physical similarity: participants in both activities are generally working indoors, sitting down, putting money at risk and looking to increase their net worth.

Helping to cement the connection between the two activities are high-profile poker players whose Wall Street day jobs pay a lot better than your average Vegas card tournament. In early July, Greenlight Capital's founder David Einhorn finished third in a special WSOP charity tournament. In doing so, Einhorn bested 45 of the 48 world-class players who'd put up the $1 million entry fee. (A guy named Phil finished fourth.) Einhorn won over $3 million for his efforts. That's probably a rounding error (or a bellhop tip) for the hedge fund wizard who shorted Lehman Brothers into the grave.

And Einhorn isn't alone. One of the hottest poker players right now is a former BNP Paribas derivatives trader named Andy Frankenberger. Within the last year, Frankenberger has won a WSOP tournament, as well as a World Poker Tour event.

Plus, there's no shortage of books and articles making the comparison between poker and investing. These usually emphasize concepts like risk management and expected payoff that are common to both.

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