25 min listen
Ep. 377: Annie Duke Interview with Michael Covel on Trend Following Radio
Ep. 377: Annie Duke Interview with Michael Covel on Trend Following Radio
ratings:
Length:
56 minutes
Released:
Sep 4, 2015
Format:
Podcast episode
Description
Today’s guest is author, entrepreneur and professional poker player Annie Duke. Michael Covel and Annie Duke discuss several of the countless ways in which the psychology of gambling overlaps with that of trading, investment and other aspects of business.
Annie explains the importance of thinking probabilistically for decision-makers. Gamblers, like investors, can sometimes become so focused on their losses that it begins to affect their decision-making process in a negative way. Annie calls this “tilt” and says it occurs when players put too much emphasis on outcome. She points out that so long as you are getting an overall return on your investment via a positive expectation, small losses should be both expected and absorbed.
Michael and Annie also discuss further in depth expectancy and how the top minds in both trading and gambling think about the long-term. When involved with risk, it is always important to think realistically. If there is a 90% chance of success, don’t round it up to 100% simply to boost your confidence. This way, if the venture fails, you won’t feel the need to discard your strategy since there was always that 10% chance of failure. Overall, your odds of success are still very good. This is why Annie’s thinking is so important for all of us.
In this episode of Trend Following Radio:
Focusing on the process instead of the outcome
Understanding that it’s about your return, not you winning percentage
Recognizing that in investing, consistency is unnatural
Thinking probabilistically
Maximizing your expectancy
Understanding that a loss doesn’t necessarily reflect bad thinking
Want a FREE Trend Following DVD? Get it here.
Annie explains the importance of thinking probabilistically for decision-makers. Gamblers, like investors, can sometimes become so focused on their losses that it begins to affect their decision-making process in a negative way. Annie calls this “tilt” and says it occurs when players put too much emphasis on outcome. She points out that so long as you are getting an overall return on your investment via a positive expectation, small losses should be both expected and absorbed.
Michael and Annie also discuss further in depth expectancy and how the top minds in both trading and gambling think about the long-term. When involved with risk, it is always important to think realistically. If there is a 90% chance of success, don’t round it up to 100% simply to boost your confidence. This way, if the venture fails, you won’t feel the need to discard your strategy since there was always that 10% chance of failure. Overall, your odds of success are still very good. This is why Annie’s thinking is so important for all of us.
In this episode of Trend Following Radio:
Focusing on the process instead of the outcome
Understanding that it’s about your return, not you winning percentage
Recognizing that in investing, consistency is unnatural
Thinking probabilistically
Maximizing your expectancy
Understanding that a loss doesn’t necessarily reflect bad thinking
Want a FREE Trend Following DVD? Get it here.
Released:
Sep 4, 2015
Format:
Podcast episode
Titles in the series (100)
Introduction: The Trend Following Manifesto with Michael Covel: Michael Covel, author of Trend Following, The Complete TurtleTrader, The Little Book of Trading, and Trend Commandments, introduces his podcast--The Trend Following Manifesto with Michael Covel. This is the first episode, the starting introduction, of... by Michael Covel's Trend Following