From an early age, I always had a natural affinity for saving money, opening my first bank account with $100 when I was 11 years old. Most of my friends would describe me as cheap (in a good way!). But in addition to a frugal disposition, I also have a risk-taking side. I spent hours studying card-counting strategy for blackjack, analyzing betting strategies for baccarat, and playing online poker.
I spent 6+ years playing tens of thousands of poker hands a month, constantly exploiting tiny edges and opponents’ mistakes. A successful poker player wins not only by playing the cards, but because opponents rush into decisions with incomplete information, miscalculate probabilities, or let emotions cloud their judgments – sounds a lot like investing right? Patience, money management, analytical abilities, and bankroll discipline all apply both to the investing and poker world.
In poker, the number one goal is to preserve capital (bankroll). At the same time, the player must place big bets when the odds are favorable in order to maximize expected value.
To complete the poker/investing analogy, when a single click can wipe out an entire bankroll, watching a portfolio drop by a few percentage points on a down day doesn’t seem so bad.
I’ve always enjoyed reading about the stock market and started studying in earnest in 2007 right before the whole financial world seemed to crash. During 2008-2009, I sold a few positions too early (a big mistake) but kept my composure for the most part and managed to pick up some great names at bargain prices. Over the past three years, I’ve started to study the principles of value investing, molding my philosophy after famous value investors like Warren Buffett and Benjamin Graham.
I started this blog to share my analysis and investment ideas, get feedback from fellow investors, and to continually refine my thought process. Last year, I decided to return to business school for MBA at UNC Kenan-Flagler, and will be pursuing a full-time career in the investment world after graduating in May 2013.
(Originally written in May 2010)