*** Collin Moshman Blog ***

How do People Get Rich?

About 8 months ago, a friend and former student of mine got in contact about collaborating on some investment research. He sold a successful company years ago and has invested in just about everything since then, and the idea was that he would walk me through his ideas and strategies, and I’d in turn use my math background to help him where possible.

That experience led me to give a lot of thought to non-poker investments, and the question of how some people end up getting rich. I believe there are three basic ways:

Gift. Straightforward -- your parents are rich and you inherit $50 million. Ship the trust fund!

Select the right career and get lucky. In certain jobs, you’re very unlikely to get rich. For instance, if you’re a dentist or an accountant, you’ll likely have a very stable income, but are very unlikely to end up rich. If you’re an aspiring actor or athlete though, you have the potential to become rich if you reach the top of your profession.

Philosopher/investor Nasim Taleb labels the dentist-type jobs as being from extremistan and the athlete jobs as being from mediocristan. Despite the cooler name for the extreme jobs, they have a major disadvantage too. In particular, the people who don’t succeed often end up earning very little. Getting rich in them requires the odds majorly going your way. For every Michael Jordan or George Clooney, there are countless aspiring actors/athletes who will never get rich due lack of talent or genetics for success at the very top levels, not getting noticed/casted, etc.

Find large edges and bet big. Suppose you’re investing in stocks. While diversifying will help limit your losses, you’re also very unlikely to get rich that way. Earning say 10% a year on your money, even compounded, is great but won’t take someone without much money and make them rich. You need to find significant outperformers and bet big on them. If you’re able to select a couple investments a year that return 70% a year, now you’re on the path to getting rich.

This last category (finding edges and betting big) is kind of a subset of finding the right career, i.e. you’re choosing to be an investor and if you’re one of the most successful you have the potential to be rich. In fact you can do it part-time and without a lot of money. Start with $5k and average 50% a year, and in 20 years you’ve got yourself well over $10 million. The only catch of course is that it’s an incredibly elite feat to accomplish, but Warren Buffett famously guaranteed he could manage it if he had a smaller portfolio.

There’s a parallel between poker and investing with the goal of getting rich. Many of the players who make it to the top buyins have managed their bankroll aggressively (with that description putting it mildly in cases) at least at times, such as playing in a cash game that represents 25% of their bankroll because of a weak opponent. Find an edge, bet big.

I’m definitely not saying this hyper-aggressive approach is the right thing to do, either in poker or investing. If you always take the conservative route, such as investing in a diversified portfolio, you’ll probably never get rich but you’ll also have much lower swings. There’s also nothing that says that getting rich is the ultimate goal -- for many it may not be.

If there’s interest I’ll talk in future blogs about my experience following the investments of my friend, and the types of non-poker investments that interest me at this point.

Hey,
Nice post. I would defenitely follow your posts about infestments :). For a while i have thought alternatives or additions for poker also, but nothing really good still.
GL with it!

Yes , that is really interesting and im sure many would like to ear more about it
about the 3 basic ways , although of course your ar egiving a "light" opinion
in the subject i woul add other factors
(not naming a few like politics where corruption and favours lead to nice sums of money) these are based in a close knowledge as some people in my family
own several business of course not in the level of buffet all small companies
but nevertheless with 40-50 people.

These factors are human relationship knowledge and the ability to "manipulate" influence people , also the ability to be creative with the law
from offshores to a million other things , sometimes they dont compromise because they want to change the rules if that suits them better
etcetc , few people are really successfull by folowing all rules
to look at what well known companies are willing to do please read this

BBC-iTV sCANDAL

Definitely interested to hear more about this. I rarely use the pokerstrategy forums but this looks very interesting, I'll certainly follow to see what discussions this throws up.

Cheers Collin, interesting stuff.

Excellent post Collin. Tell us more about your friend's story!

Originally posted by maritsula
Excellent post Collin. Tell us more about your friend's story!

+1

Thanks for the comments/interest kevvu, Antonioull, Pilks, maritsula, and doncorleone -- more definitely to come on this shortly.

Today's Post: How Much is FTP Money Worth?

Since the announcement that Stars bought FTP, a lot more people are trying to sell their FTP money. There’s definitely potential for buyer and seller to benefit, the seller from getting needed money immediately, and the buyer through paying a low enough price that he gets a good deal. Here are the factors affecting the value of FTP money:

Time preference. Money now is better than money later.

Risk of Full Repayment not Happening. For ROW players, it’s very likely that repayment will happen in full, even if there are minor delays beyond the timeframe given by Stars. But it’s never an absolute certainty until it actually happens. And for US players, there’s a greater chance of further delays or lack of full repayment.

Risk of Player Scam/Hassle. The other party may delay or outright scam. With reputable people, this risk may be very low or negligible. But this is one problem for sellers – even if your plan is to snap-ship FTP funds the minute you receive them, the buyer is going to account for whatever they perceive the risk of scam/hassle in their offer.

Premium of Cash over Online Money. Stars money trades at a discount of at least a couple percent compared to bank money. The buyer of FTP money may be trading his BOA/wire/Paypal for what will (if everything goes right in a ROW FTP account) be online money.

Based on the above factors, what should FTP money trade at? Personally I’d rather Merge money than FTP money from a reputable ROW player, and Merge trades at 87% or so. So if I had to come up with #’s out of my head, I’d put reputable ROW FTP money at maybe around 5% lower than Merge, say 82% or so. The DOJ concerns for US players are serious, so I’d lower US FTP money by another 10-20% and say 67% or so.

I’m not sure how many trades are actually going through or at what prices, and I’m not necessarily buying myself even at these discounts. But if I had to estimate “fair” prices, those are roughly the figures I’d give assuming reputable sellers.

I think you shouldn't trust anyone that doesn't have at least a reputable reputation and even then. Just a year maybe a bit longer a fairly respected member of rhis community that posted a lot and seemed very interested in the game suddently scammed a coupe of members here not to mention some fairly known pro's lately that scammed there backers

Good points Sirlidion.

Today's entry: Analyzing a Strange Bluff-Raise

A TM horse who’s a solid MTT reg asked me to go through a HH with him. I was happy to do this -- besides potentially spotting leaks and helping him improve, I also have the chance to gain insight from a top player and improve my own game.

In one hand, he bluff-raised a coordinated flop in what seemed like a pretty unusual spot for it.

Blinds: $2800-$5600-$700

Reg in MP1 raises to $11,200. Hero flats 99 on the button. Both blinds fold. The effective stack between Hero and Villain at the start of the hand is ~$205k.

Flop: Td Ah Qc

Villain bets $18775 into $37100. Hero raises to $44900.

My initial reaction was that unless Villain’s on an abnormally wide opening range for MP1, his range connects strongly with this flop, making it a bad time to bluff-raise.

On the other side…

We’re risking half of what’s out there (and could arguably accomplish the same sizing even a bit smaller), so we show a nice profit if he folds even half the time. We’re also representing a lot of strength raising over him here. From his perspective it’s probably unlikely we’re bluff-raising, and a typical value-raising range would be something like: ATs, AQ, KJ, TT, possibly AK at the bottom, and discounted QQ/AA. So if villain has a hand like A9s, given that he perceives Hero as fairly solid, I think he’d probably just toss it.

Quantitatively, let’s say he’s opening the top 18% or so, so about 250 combos. When we raise, he stays in (and we give up) when he holds: TT, QQ, AA, AT+, KJ+, QJs, QTs. That’s about 120 combos he’s staying in with, meaning he folds just over half his range given these assumptions.

So despite the fact that this looks like a bad spot to bluff-raise (or at least it did to me), depending on his opening range and whether he folds stuff like A9s/KK to a raise here, it looks like it could actually be a pretty decent spot.

Collin, i love your coaching and i love your Blog!

Your are freaking amazing and such a great Coach, i enjoy each one you do

Would like to see more coaching and videos... bring it on

Thanks Qwertz, appreciate the nice words!

Impressions on the Stars Games 1.5 Years Later

I recently got to play on Stars again for the first time in close to eighteen months, which was pretty great. One thing that I wasn't quite expecting though was how much slower the SNG traffic was. I remember when (said the old man) $109 and $215 9-man turbos went off frequently, and a level like the $30s went off super-quick. This time around, it seemed to take an average of 10-15 minutes for a 9-man $30 turbo to run. Granted this was night PT -- far from primetime on the now way more Eurocentric site. By far the SNGs that went the quickest were the 6-max hypers.

There were of course a ton of no-limit cash games and MTTs going, but it was also slower on the limit side, both with cash games and HUSNG.

I’ve heard a lot of people say that to play on Stars when you’re on a PT schedule, you’ve gotta wake up earlier to hit peak times for the site. Despite seeing firsthand exactly what they mean traffic-wise, I still think both options are viable. The games seemed fairly soft when I was playing (at least at the mid-stakes), and from railing horses at different times of day, I definitely tend to see softer play at night PT. So if I were grinding fulltime, I’d be happy to play then, just mixing in a bunch of different formats and buyin levels to fill tables.

While I’m no longer a fulltime grinder, I'd really like to begin putting in some good volume on Stars, both to stay maximally current as a coach and because it’s great to be back online. It’s also pretty sweet playing on Katie’s laptop on the balcony overlooking the ocean.

Unrelated, I had a friend and TM member ask me about putting up a banner on the site for his sister’s new greeting card and wrapping paper company. I suggested that the two demographics -- poker and wrapping paper -- might not be the best match, but he asked me to take a look anyway. The cat drawings were epic, so definitely check out the site.

Not just stars.
I get home from work at 17:00 PT, and there are so few people playing -- and it gets worse as time goes on.

By not allowing international player pools, the new legislation -- if it ever passes -- will not improve things at all.

Agree VorpalF2F!

Today's Entry: Three Stories from Mexico

Life in Rosarito is great. The #1 question I still get asked about Mexico is whether it's safe there; the funny thing is that inside of Calafia I really can’t imagine feeling safer. Everyone who lives there seems like nice/good people, it’s gated and there are guards on duty 24/7. The main guard, a very nice guy who loves dogs named Lalo, wears a kevlar vest all the time – which I think is pretty optimistic if he’s looking for that kind of action at Calafia. (The town is safe too.)

A few quick stories from our time there so far.

Shoving 92o 75bb Deep

It was great playing again. I put in about 9 decent sessions (playing from around 6pm-midnight PT) playing a wide mix of all the 180s running, low and mid-stakes turbo MTT (and the occasional nonturbo), $30 9man, $60 9-man nonturbo, and $3/$6 FR LHE. It went really well, I was up around 100 buyins, made platinum star, felt really good playing.

On to the story though – I was usually playing around 16-18 tables stacked on a laptop with hotkeys. I hit my shove button deep in a 22 turbo and nothing happened, and it was a really clear shove so I stupidly hit it again and watched in horror as my next table activated and I 4bet shoved 92o 75bb in a $30 9-man. I pulled the table off to the side to watch the carnage. The first guy folded, and I’m thinking “please fold” as the 2nd guy tank-calls AK. But I binked the suckout! It was pretty sweet, you had to be there. Definitely one of the happier times I’ve had winning $27 in equity.

Cars Colliding at Border

The wait at the Mexican border to get back into the US can be pretty brutal, at times lasting 3 hours or longer. The whole time you’re waiting, there are locals camped out by the cars aggressively trying to sell food and trinkets. You’ve got no choice but to wait there, knowing that when you get to the front your only reward is a grilling and possible search. (Cue the libertarian rant.) The effect is to make people a bit short. Look over into a neighboring car, and there’s a good chance you’ll see a head in someone's hands.

Nonetheless it was still a bit surprising to see the lengths one guy went to prevent someone from cutting in front of him. A truck turned into his lane such that it was slightly in front of him at a heavy angle despite his best efforts to prevent it, so he kept going and purposely collided with the side of the truck with his own beat-up truck to re-overtake it. Then neither got out of their cars, like it was just totally par for the course.

And lastly, a video story: Wilbur and Katie in Mexico

Heads-Up vs 8x Limp-Caller at New Venetian Room

The new Venetian poker room is awesome.

I played a bit of 2/5 this weekend, and was surprised how many regs there were. They knew each other by name and sounded like they played together often. One who I actually knew from outside of poker played quite well, but most were not particularly strong players -- routinely limp-calling large raises, a couple with very high fold-to-cbet letting you show a nice profit by iso’ing them wide and cbetting.

Here was one more involved hand played vs an 8x limp-caller.

Pre-flop: Six players limp, I raise to $40 with AsQs in the big blind, folds to button who calls, SB folds.

Analysis: I started the hand off with $535, button covers. He had been at the table for only a few hands, was late 20s and bought in for $1,000. I put him mainly on speculative hands like 22 or 98s that he decided to try and outflop me and float/bluff-raise a lot of flop textures IP.

Flop: Td 5s 4s

Action: I bet $55, he calls.

Analysis: Sizing such that if he raised it likely wouldn’t be to more than $150 or so, leaving me plenty of room to shove.

Turn: Kd

Action: I check, he checks.

Analysis: His range heading into the turn consists mainly of floats, draws, and some made hands with marginal showdown value. I expected him to bet often, allowing me to check/shove my 12-out draw with a lot of fold equity. Slightly surprised when he checked it back.

River: Js

Action: I bet $45, he raises to $220, I shove, he calls.

Analysis: Sweet river! The problem with a normal bet of ~ $150 is unless it’s a flush-over-flush cooler for him (in which case it probably doesn’t matter all that much what I do, the money should go in regardless), there’s not all that much he has that can call, and I don’t think he bluff-raises a 2/3 pot bet very often here. Checking would be fine, but I decided to get fancy and fake a blocking bet instead. I try to look nervous, fumble around and slide out 9 red chips to rep a scared AT or something. I figure if my read on him is right, he won’t be able to resist bluff-raising busted draws and turning hands with marginal showdown value into bluffs. Then once he tosses in the raises, a shove is only slightly more than a minraise, so there’s not much decision left.

Most likely it was flush-over-flush and my cute fake blocking bet and hollywooding at the river were pretty pointless. Still a fun hand though.

Hi Collin, an excellent insightful blog, and I really enjoy your and Katie's videos (and you and Katie's first video! That was a lot of fun), especially the MTT and MTSNG ones; would be very interested to see a cash-game video from either of you, perhaps with a discussion of how a background and expertise in tournaments informs your approach to cash-games.

As someone who hasn't made a withdrawal yet, I don't understand your comment that "Stars money trades at a discount of at least a couple percent compared to bank money. " Do you mean that 98% is the best rate at which withdrawals can be made, counting fees from banks and organisations like Moneybookers?

Do you think your book can improve a player that pulls 2%+ roi in stts avg bi 11$? Or do you believe is not worth reading for this player and you suggest him something else?

Hey Colin
Hope your well and enjoying the baller lifestyle

I just want to say I have been watching your videos on ps and I have really enjoyed the content and have found them really helpful. Good Job Colin!!!

Colin do you know Newb Guy?
He s at your stable (sharkscope says that)
Explain me please this:

http://www.handconverter.com/hands/1963867

and its not single hand hes playing like that (check my blog).