Trading vs. Sports vs. Chess vs. Poker

I’m about to show you why you’re so lucky to be a trader. You may be going through some tough times. Maybe you’re a developing trader who’s still struggling to become profitable. Maybe you’re a beginner who’s overwhelmed by the complexity of it all. Maybe you’re a pro who’s going through a tough drawdown. Regardless, you’re more lucky than you think.

And to prove that, let’s do a little side-by-side comparison of trading against other performance disciplines. With each one, you’ll see more and more why you’re so lucky to be a trader.

Trading vs. Sports

Think about professional athletes. Let’s take Olympic athletes for example. They practice endlessly, month after month after month. Long grueling hours and constant sacrifices. They have one goal in mind: qualify for the Olympics and win a medal. Their wait: Four long years. And then the time comes. Their trials are here. All that hard work comes down to this. And if the performance pressure isn’t enough, they have to compete in front of a massive audience. Everyone watching their every move- ready to analyze and criticize. The gun fires, the competition starts, and… tragedy. They make one tiny mistake and are left in the dust. Four years of work, sweat, and tears down the drain in one unforgiving instant.

Now think about yourself as a trader. You practice and study endlessly, month after month after month. Long grueling hours and constant sacrifices. You have one goal in mind: trade for a living and make great returns. But there’s no four year wait. Your competition is each day. And there’s no audience criticizing you and making you feel embarrassed and self-conscious. You make a mistake and take a loss. Ten minutes later another opportunity arises and you make a great profit. And no matter what happens, tomorrow is a new day. A fresh slate. And you get to compete once again. “Must be nice””, the Olympic athlete thinks to himself.

Trading vs. Chess

Few arenas are more cut-throat than that of competitive chess. Thousands of the brightest minds compete to be the best. They’ve been groomed since they were young children, and often had dedicated coaches guiding their development. Thousands of hours of study and practice. And here is their financial reward: $2,000 prize for the first place finisher in a grueling 1-week tournament. There’s countless great chess players, but only a few household names that can make money from sponsorship. So the reward for most is the prize money. They can be a top 5 ranked player in the world and their prize is $2,000. That’ll be good enough to pay for the air fare and hotel they needed to attend the tournament. And that’s if they win.

Now think about yourself as a trader. If you become good enough to be considered world-class, you can readily make millions. A top 5 ranked day trader (if there were such ranks) can realistically pull in $2 MILLION in a single great day. Numerous independent traders have been reported to pull in consistent 7 and even 8 figures year after year. And you don’t have to wait for the next tournament to cash in. And you don’t have to travel and stay in a hotel. “Must be nice”, the professional chess player thinks to himself.

Trading vs. Poker

This one is as close as it gets to trading. But man are there some differences. To make any sort of real money, professional poker players have to play the big stakes games. And who else is playing the big stakes games? That’s right: professional poker players. This means that the best are most often competing against the best. They can’t prey on the amateurs if they want to make serious money. And if they play tournaments, they’re up against hundreds or thousands of other pros all vying for the big cash prize. No matter how good they are, their odds of actually winning the whole thing tend towards a coin toss. And while they have a good long-term edge, the short-term variance of poker is very high. So high in fact that extended multi-week deep drawdowns can be normal even for the not so super aggressive player.

Now think about yourself as a trader. You’re in one big pond called the market. And if you work on your game enough to become a skilled pro, you get to fish in this pond- a pond which includes all the amateurs. This means that while yes, you’re up against the pros, you also have millions of amateurs whose money you can take. You don’t have to be one of the very best in the world to make a great living at it. And if you do become one of the best in the world, you don’t have to sit across the other great ones and play heads-up to make your living. Your short-term variance is also much lower. You can realistically craft a style that makes money every single month with only moderate drawdowns. “Must be nice”, the poker pro thinks to himself.

 

So now tell me. What is it that you were complaining about? :)

 

 

  • Mike

    sweet lol.. nice post

    • Thanks Mike. We have a lot to be grateful for as traders ;)

  • Luis

    Great post, thanks for share it.

  • Jedster

    Very nice! Great perspective.

    • Thanks… sometimes it just takes a change of perspective to great improve our psychology as traders.

  • Komin

    Nice article, I personally play poker and I am constantly winning player but I play only low stakes because of what you mentioned in the article. I am looking forward to day when I will not need to play poker at all and I will trade for living. Hopefully, it will be soon also thanks to your blog.

    Paul

    • Great to hear Paul. Your poker playing should greatly help you in your journey towards trading for a living. You should be used to thinking in odds and just placing the bet when the odds are with you without overly worrying about whether this particular hand will win or not. That’s exactly what you’ll need to do as a trader. Best of luck with it!

      • Komin

        That is absolutely true. I know what you are saying, and I agree. Thanks for your wish.

  • Hilda

    I always find your posts very uplifting. Thank you for doing this!

    • You’re most welcome Hilda! Glad you like the posts.

  • mj

    Ziad, another GREAT post. Puts attempting to be a successful trader in proper perspective! You only lose when you stop trying. Thanks for your continual insights. I look forward to each post. Be well!

    • Thanks MJ. I think it’s all about perspective…

  • jay

    great post ziad… gives tremendous confidence going ahead !

  • in gambling the house always wins, because the odds are always in the houses favor..in trading you can change the odds to your favor…

    • Yes exactly. That’s what makes it possible to be consistently profitable.

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