Poker Legend Phil Hellmuth Has Advice That Traders Should Hear

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Joe Weisenthal (0:26)

Let's go Hello, and welcome to another edition of the Odd Lots Podcast. I'm Joe Weisenthal.

Tracy Alloway (0:32)

And I'm Tracy Alloway.

Joe Weisenthal (0:34)

Hey Tracy, remember our episode a couple months ago with Peter Borish about investing and trading?

Tracy Alloway (0:41)

Of course, it was a great episode.

Joe Weisenthal (0:43)

Yeah, that was a really fun one. But there was something he said that really stuck with me. I mean, it was a fascinating conversation, but one of the things that has really stuck with me in my mind that he said when he was talking about the great hedge fund traders of all time, whether it's people like George Soros or Paul Tudor Jones, he said what they really had in common, even more than some sort of uncanny knack, was just a real discipline about survival, real instinct for risk management, not getting blown up, not destroying themselves.

Tracy Alloway (1:16)

Yeah, I remember he said specifically the worst thing that can happen to you is basically if you lose all your money, because then you're dead, right? You're out of the game.

Joe Weisenthal (1:25)

You're out of the game, exactly right. And so a lot of the people that we call legends these days that we venerate are people who primarily have survived this long, and somehow they figured out a way to not die, not blow up, and of course in markets, pitfalls abound.

Tracy Alloway (1:42)

Yeah, I would broadly agree with that. What's the point?

Joe Weisenthal (1:47)

Today, our guest is someone else who has done an extraordinary job of surviving, of not blowing up, of risk management, bankroll management, except they're not a trader, per se.

Tracy Alloway (2:02)

Okay, I'm starting to get a little bit nervous. Who is it?

Joe Weisenthal (2:05)

You should be nervous, because I know we're going to be talking about one of the topics at which you feel the least at ease, but I'll just jump right into it. Today, we're going to be talking to one of the most successful world series of poker participants ever. He's a Phil Hellmuth. He's won 14 bracelets at the world series of poker across multiple tables.

He has made 54 final tables, and in his poker career, according to an AMA he did on Reddit last year, he's made $18 million playing poker. That number is probably higher, since that was a year ago. And I think anyone who has had this much success in poker clearly has something to teach people about risk management and bankroll management and discipline and keeping their emotions in check and many of the skills that a trader needs to survive.

Tracy Alloway (3:01)

So Joe, I'm totally on board with the analogy, but let me say in all honesty, due to my complete ignorance of the game of poker, as well as the fact that I looked up Phil's bio online and saw that he's called the Poker Brat. And then I made the massive mistake of watching a YouTube video featuring his top five table side explosions.

I'm a little bit nervous about this one, but I trust you. I'm sure it'll be a good conversation.

Joe Weisenthal (3:28)

Well, hopefully we won't be at the receiving end of any tirade.

Phil Hellmuth (3:33)

Bye.

Joe Weisenthal (3:43)

Phil Hellmuth, thank you very much for joining us.

Phil Hellmuth (3:45)

Okay, first of all, those tirades have tens of millions of views, so that's a good thing, I think. Second of all, I don't walk around like that every day, so those are good tirades, so.

Joe Weisenthal (3:57)

No, and in this day and age of televised poker, I'm sure it doesn't hurt to have a reputation as being one of the more colorful players at the table.

Phil Hellmuth (4:08)

I watch those and it's like a train wreck, but I think traders can kind of, you know, I mean, you're in a great position and everything, all indicators, could be the best position you've ever seen. And then all of a sudden, for some reason, I don't know, there's a forest fire in your stock, trying to go the other direction.

I would be throwing a tirade at that point.

Joe Weisenthal (4:27)

So that's the interesting thing, is that you do have this reputation for throwing tirades. As Tracy mentioned, your nickname is the Poker Brat, but you're obviously very successful at poker, and so those tirades don't seem to translate into terrible play. In fact, you play quite well. So the popular term is you go on tilt. You start getting emotional, you start making bad bets that are driven by emotion. It doesn't seem like your tirades lead to bad bets.