Lessons From Poker

I started playing poker during high school. It began as a game played with friends for lunch money. Then I discovered online poker, and with a free $5 given by the site, quickly climbed the ranks to winning (or losing) thousands per day.

It was a great part-time job for a kid. More importantly, it taught me some great lessons. Here are a few:

Emotional Control

In poker, the player’s skill certainly has an influence on the outcome of the game. But there’s also an element of luck that’s included in the equation. Sometimes, cards may not fall your way.

As I quickly discovered, an unpleasant side effect of when those unlucky streaks happen is the phenomenon known as tilt:

‘Tilt’ in poker describes an episode during which the player can no longer control their game by rational decisions. It leads to a loss of control over the game, a loss of emotional regulation, higher cognitive distortion, and a loss of money.

In essence, the player begins to behave irrationally, letting emotions take the rein. I believe a part of it is feeling a sense of injustice. Why do I deserve to be so unlucky? That money should’ve been mine.

Playing poker at the higher levels leaves no room for emotions. There is only room for numbers, probabilities, and rational logic. To invite emotions as a stakeholder towards influencing your decisions, is to invite mistakes.

Thinking Long Term

Poker is a game built on small edges. Even the absolute best hand against the worst hand will lose 12% of the time pre-flop (AA vs 72o). In the short term, that means there will be a lot of variance.

Imagine a game with a weighted coin that slightly favours one side 55% of the time. And this game allows you to choose that side and wager money. This is a small edge, and in the course of a couple flips, there’s a chance you end up losing money instead of gaining. But in the course of a million flips? You’ll be quite rich.

I think people today place too much weight on the actual result of a decision. And they also tend to think in a short time-frame. So what happens is that they could come across a real-life example of that coin flipping game, experience a loss or string of losses and just stop or give up. Even though in the long term, they’ll be winners.

Forget the short term noise. Focus on the long game.

Accepting Risk

I found myself much more risk-inclined after my poker phase. It certainly wasn’t a newfound appetite to live life dangerously or the like. But more of an appetite to trade more risk for more reward.

I noticed with friends and people I know, that most tend to over-estimate risk and under-estimate the opportunity cost of inaction. Maybe that’s the way our brains have been hard-wired based on evolutionary pressures? Whatever the case, I have a feeling today’s modern world is a lot safer than our brains perceive it to be.

What’s the worst that can happen if you quit your job? Or try a new career? What’s the cost of not doing that? What do you stand to gain?

In poker, there are very few surefire bets where you cannot lose. Playing safe and conservative would leave you on the sidelines for most of the game - watching many opportunities with great upside pass you by.

I think it’s the same in life.