PDA

View Full Version : 20K bankroll for poker and investing


08-23-2005, 05:10 PM
Hello, I am currently 17 years old and have built up 20K from playing live poker and online poker in the past 7 months, I only plan on playing 20, 30 and 50 dollar SNGS Online while playing steady 4/8 limit and 2/5 no limit in the indian casinos. I was wondering, how i should allocate my 20,000 to maximize return. Should I save up more and open a restaurant? Should I invest into an index fun I.E Vanguard, Should i invest into the stock market...if so how much should I invest, how much should i keep for poker. Also, Should I just save up alot of money and take on Day Trading. Any comments iwll be appreciated

ttw22
08-23-2005, 06:25 PM
What indian casinos let you play when you're 17?

RunDownHouse
08-23-2005, 06:48 PM
I highly recommend either opening a restaurant or day trading. If you don't do that for whatever reason, either invest into an index fund or invest into the stock market, but not both.

FishHooks
08-23-2005, 07:40 PM
[ QUOTE ]
If you don't do that for whatever reason, either invest into an index fund or invest into the stock market, but not both.

[/ QUOTE ]

Index funds are part of the stock market.

DesertCat
08-23-2005, 07:50 PM
[ QUOTE ]
I highly recommend either opening a OVEN and BURNING ALL YOUR CASH AT ONCE

[/ QUOTE ]

FYP.

95% of daytraders go broke within a year. The record of restaurant ownership is only slightly better.

Beef
08-23-2005, 10:54 PM
On average, it takes five years to see a profit on a restaurant.

Forget day trading, way to volatile.

Peel some off and do some index funds, perhaps loan shark for a while (lol)

squiffy
08-24-2005, 12:27 AM
I really wish I could learn how to make money playing poker. I have tried, but with no success. Maybe I am not trying hard enough.

Anyway, the only ways i have found to make money are working, investing in real estate, and investing in stocks.

Some day, when I have time, I will go back to studying and playing poker. It would be great fun to earn a supplemental income with a fun hobby.

squiffy
08-24-2005, 12:36 AM
They say that long term a successful index fund can return on the order of 10% a year. And the returns won't be taxed until you sell.

Real estate apprecation depends on the location and the amount of leverage you pay, how much you put down etc. But real estate returns can be tremendous and are tax free or tax deferred, largely, until you sell.

Poker earnings, assuming the govt ever finds out about them are taxable, in theory.

I guess you need to compare returns. But also diversify. If you can make a lot higher return playing poker, then play poker until your bankroll is so large that the extra money is really not needed for playing poker.

Then when you invest the EXCESS MONEY, the money will be working for you and making money while you sleep and eat and play poker.

The neatest thing about investing is that it's like owning a slave. A $50,000 downpayment on a home or a $50,000 investment in a good index fund or good stock, can be like a servant who works for you 24 hours a day, but doesn'tcomplaint, doesn't get sick, doesn't get tired, and keeps bringing money to you everything he earns.

Let's say you can make 10% a year on the stock market.
And let's say you invest 100K in stocks. Every year, without you lifting a finger, the money brings in 10K.
Then the 10K brings in 1K, then the 1K brings in etc. etc. Compounded interest. Reinvested dividends and interest. Wowie.

Yowie.

RunDownHouse
08-24-2005, 10:19 AM
[ QUOTE ]
[ QUOTE ]
If you don't do that for whatever reason, either invest into an index fund or invest into the stock market, but not both.

[/ QUOTE ]

Index funds are part of the stock market.

[/ QUOTE ]
Good God, how thick do I have to lay it on for you people?

And if I remember correctly what my friend from the CIA told me, over 90% of restaurants fail within two years. So I guess you should do that instead of day trading.

fluff
08-24-2005, 04:32 PM
First of all, I would forget restaurants or daytrading. Your "bankroll" even at 20k is not enough. For daytrading in particular, you won't even be able to beat the rake (commission). Without any solid experience/plan in the matter, you'll lose all of it anyway, so no bankroll will be big enough and the point is moot.

Second of all, you need to establish how much of that money will be needed for your poker bankroll, and that depends on a few things: are you going to "withdraw" from your bankroll for anything, what expenses do you have, what is your expected return, what is your risk tolerance...etc. Judging by the limit you play, you'll probably want your bankroll between 5-10k.

Now what to do with the rest depends on your goals. How long do you want that money to be invested? Are you going to need it in the near future? Do you need it to be fairly liquid? How much time are you willing to spend researching your investments?

Sniper
08-24-2005, 05:22 PM
[ QUOTE ]
how much should I invest, how much should i keep for poker. Also, Should I just save up alot of money and take on Day Trading. Any comments will be appreciated

[/ QUOTE ]

You should be setting aside a percentage of your poker winnings every month and investing it in the stock market.

If you consider the 20K to be overbankrolled for your current poker level, then you could seed your brokerage account with the excess.

Beyond that, how you should allocate your stock market investments should be based on how much time you are willing to put in to increase your returns. If you only want to devote a minimum amount of time, then stick the money into an index fund.

As for Day Trading, you should consider that a full time job, just like going pro in poker. If you have an interest and put in the time to educate yourself, then go for it. Many of the issues discussed on 2+2 with regard to "going pro" apply to becoming a day trader as well.

nervous
08-24-2005, 08:17 PM
Index fund. It's the only one that you don't need any eperience to do well in. I just started investing in one this month and plan to deposit into it monthly. My situation is fairly similar to yours.

Research Vanguard funds.

wadea
08-25-2005, 03:13 PM
The simple answer? Stay on the horse that brought you here. Obviously, poker is working out pretty nicely for you. Considering your age, if you are over-bankrolled for the games that you are comfortable in, you should probably invest the excess in an S&P500 tracking index fund. Trust me, I'm young enough to remember being 17 - you don't know as much as you think you do. If you try and get cute with your money by picking stocks, day trading or starting a restaurant, there's probably about a 95% chance that you will look back in just five short years and roll your eyes at your past self.

Finally, depending on where you live and what kind of income you have or may eventually have, I might recommend buying a home (instead of renting a place) as soon as you can possibly afford it. I'll bet just about everybody on this board would give his left nut to be able to go back in time and make a down payment on a house at 20 years old.

Good luck,
-w.a.

08-25-2005, 04:29 PM
Thanks for all the input guys.....My moms side of the family are all into the restaurant business, and I just moved to Carlsbad,Ca. I think im planning on opening up a lebanese sandwich place. My dads going to lend me some and I'm only going to keep 4,000 for my poker bankroll. The restaurant, I believe will succeed if I do it right, And if it works out, i could build chains across the west coast. If not, back to school/poker/working hard/college ;[

Femto
08-26-2005, 05:45 PM
Like somebody else said, opening a restaurant is a bad idea. Everybody thinks they can do it, but more than 90% of new restaurants bust within a year.