poker pro to trading - Page 4

stoxtrader · #31 02-23-2005, 01:07 PM

certainly the biggest reason I think would be risk - would you rather have a 5% chance of not getting paid for the year, or a 10% chance?

the 10% chance probably carries a higher upside, and you can pick your own numbers, but I would think you have less risk working for a firm.

sfer · #32 02-23-2005, 01:18 PM

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This is undoubtably an idiotic question, but why would anyone prefer trading for a firm to trading just for themselves? I guess I could see how capital issues could become a problem for the individual trader, but barring that, why give up the extra money if you already have capital to work with?

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Leveraging at or near LIBOR is a pretty sweet deal.

mrbaseball · #33 02-23-2005, 01:26 PM

There is HUGE psychology involved too. I have traded the Chicago markets (CBOT, CME) for the past 18 years. But I have also traded pretty much all commodites and their options and more than my share of stocks and stock options. A good portion of that was "on my own" and the difference in the level of heat is astounding. The stakes are enormous and just one little fluke occurance can put you out of business for good.

Also it's interesting the way "trading" has been discussed in this thread. As if it were generic. There are all different kinds of trading. A Chicago market maker is different from NY equities or cash bonds or derivatives or energies in Houston or pure arbitrage or some guy banging out technical trades on Trade Station in his basement. Each has it's own unique skills required.

Paluka · #34 02-23-2005, 01:29 PM

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There is HUGE psychology involved too. I have traded the Chicago markets (CBOT, CME) for the past 18 years. But I have also traded pretty much all commodites and their options and more than my share of stocks and stock options. A good portion of that was "on my own" and the difference in the level of heat is astounding. The stakes are enormous and just one little fluke occurance can put you out of business for good.

Also it's interesting the way "trading" has been discussed in this thread. As if it were generic. There are all different kinds of trading. A Chicago market maker is different from NY equities or cash bonds or derivatives or energies in Houston or pure arbitrage or some guy banging out technical trades on Trade Station in his basement. Each has it's own unique skills required.

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Good post.

johnfromvirginia · #35 02-23-2005, 02:11 PM

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True, but there's pretty much zero risk to law school. If I go to law school, I am nearly guaranteed to be making a million dollars a year 10 years from now, assuming that I work my butt off.

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This statement is extremely naive. I graduated at the top of my class from a top law school and I know a LOT of hard working, well educated lawyers who are grinding it out and will never be rich. Furthermore, partners at top firms do not average a million dollars a year anymore. The top 1% of the lawyers in this country probably don't all make $1M/year. With very few exceptions, that kind of money only comes to two types of lawyers: (1) SUCCESSFUL personal injury lawyers and (2) white shoe firm partners who bring in the clients. The partners at the white shoe firms who do all the work, but don't bring in the clients typically don't even have an equity stake in the firm anymore. Plus, the partner track is usually 9 years now. So, if you took your LSATs this year, you might be up for partner in 13 years. A first year partner at most firms makes between $200K and $350K depending on the size of the market.

I don't mean to keep raining on your parade, it's just that this thread keeps going down roads that I am pretty familiar with. If you are young and want to give trading a try, by all means give it a try. As a young man with few or no obligations, what have you got to lose. Generally speaking, the traders I know are a lot happier than the lawyers (the lawyers all wish they had a mulligan). If it doesn't work out, you can try something else. It's just that you should be aware that both law and trading are long hard roads where the really big payoffs are not hanging low on the tree--like poker or anything else, I guess.

turnipmonster · #36 02-23-2005, 02:16 PM

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True, but there's pretty much zero risk to law school. If I go to law school, I am nearly guaranteed to be making a million dollars a year 10 years from now, assuming that I work my butt off.

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seems to me like you might want to think about what your goals are, and then what the best way to achieve those goals is. I know lots of lawyers and none of them are making anywhere close to the figure you describe.

--turnipmonster

johnfromvirginia · #37 02-23-2005, 02:24 PM

I think your numbers are a little off. If you are trading for a firm, you are trading with their money. You have a 100% chance of getting paid at least your salary. You might not get a bonus and you might get fired, but you'll get your salary. 98% of daytraders fail within two years and by "fail" I mean they lose everything. "Everything" in this context, of course, refers to their money, not the firm's money. It is a very different scenario. When the Chicago trader who posted earlier said there's more heat involved in trading on your own, he knew what he was talking about. The risk/reward ratio is completely different. Like playing no limit hold em in a real cash game instead of a tournament where all you lose is your buy in. Probably worse, because like I said, as a desk trader, you have a 100% chance of being paid at least your salary.

djack · #38 02-24-2005, 01:04 AM

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[ QUOTE ]
True, but there's pretty much zero risk to law school. If I go to law school, I am nearly guaranteed to be making a million dollars a year 10 years from now, assuming that I work my butt off.

[/ QUOTE ]

This statement is extremely naive. I graduated at the top of my class from a top law school and I know a LOT of hard working, well educated lawyers who are grinding it out and will never be rich. Furthermore, partners at top firms do not average a million dollars a year anymore.

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You're not serious. I worked for Skadden (not even the nyc office) in high school, and those partners were all making a million bucks. I saw the occasional EFT deposit stub, so I know what I say is true.

That said, I'm not interested in nitpicking over how much attorneys can make. I know what my opportunities would be in law.

stoxtrader · #39 02-24-2005, 12:38 PM

agreed. I don't plan on assigning well thought out numbers. there are too many variables.

johnfromvirginia · #40 02-24-2005, 02:07 PM

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You're not serious. I worked for Skadden (not even the nyc office) in high school, and those partners were all making a million bucks. I saw the occasional EFT deposit stub, so I know what I say is true.

That said, I'm not interested in nitpicking over how much attorneys can make. I know what my opportunities would be in law.

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Bullshit. I've never seen a high school kid serving coffee at a firm like Skadden in any city and certainly not in any capacity that would give him the "occasional glance at an EFT." Furthermore, most (but not all) lawyers would agree that Skadden is the VERY BEST LAW FIRM IN THE WORLD. If you go to law school thinking that you can expect to do half as well as a Skadden partner then you are on crack kid. Skadden is the creme de la creme in every major city. They are not always considered true white shoe, but they are the most aggressive, most intelligent, top of their class and, above all, most highly compensated large firm lawyers in the world. The only lawyers that make more than the average skadden partner are the really lucky personal injury guys. However, partners in the next firm down the chain from Skadden make about half what the skadden guys make and the number three firm distributes less than that. You need to do some due diligence son. You're looking at Moneymaker and Raymer and thinking the average poker player must make a lot of money "if he works his ass off." The reason you're not interested in "nitpicking" about what your opportunities would be in the law is because you're a dreamer who has no idea what he's talking about, but who isn't interested in informed advice.