LG John

I’m interested to try and gauge average (scoobynet) man’s attitude to risk but I really have no idea how to benchmark such a thing. I think that I’m quite risk averse and I believe that it may hold me back a little in life – I’m generally quite fearful of change although I’ve been a lot better in recent years. I can handle the thought of making cut backs if the going gets tough such as having less disposable income and making do without a fast car but I really can’t peg the thought of losing the house. I draw the line there – it’s my home and as I’m not particularly high up the food chain, therefore a downgrade would mean moving out of Edinburgh or to scumville.

Perhaps anyone with an interest could write a little something about their attitude to risk in respect of what they would be willing to lose in order to materially gain. Maybe you’ve got a story to tell of where you jumped into something and got burnt or never looked back, etc.

As a bit of background: Some of you will know I’m quite an avid part-time poker player and over the years I’ve proven myself a consistent winning player. I’m very confident that I could make considerably more per hour than I bank after tax in my job but obviously going pro would involve considerable risk. Ideally I’d want a working poker specific bankroll of at least £15-20,000 with around a £10,000 float on top of that to cover bad months, etc. However, it would take considerable time to build up this sum of money playing part-time only unless I get a lucky big win in a multi-table tournament. At £30 an hour we are talking 1000h of play and with a full-time job, partner and life out of poker I really can’t sustain much more than 10h a week thereby resulting in a slog that would last over 2 years! I often wonder if I’m being overly careful though as I don’t have dependants, I have a supporting partner and there seems to be jobs advertised in my profession locally every week suggesting that if I was willing to take almost anything I could get back into paid employment at the level I’m currently at within 3-6 months. I calculate my current job income to be around £13.50 per hour worked after tax/deductions and my performance suggests I could easily achieve £25-35 per average hour at poker so there is considerable reward.

I’m not looking to turn this into a ‘go for it Saxo, you’ve little to lose’ thread as the timing isn’t right just now anyway (house is a building site!). I’m really trying to create a thread that might give an indication of people’s attitudes to risk. Do you read my background and think:

a) Why is this guy not jumping in and giving it a go?
b) He’s right to slowly plug away to build up very substantial reserves in case it goes **** up
c) Something else
d) I hate this guy, I wish I’d read a Pslewis thread

Discussion welcome

///\oo/\\\

Good question Kenny

I am pretty risk averse when it comes to material gain - but am about to take a pretty big risk for a massively improved quality of life.

Given your current circumstances, option b sounds like the safest bet.

Otherwise you need to be satisfied in yourself that if it does go **** up, you'll be able to deal with that and move forward without huge regret.

I deal with people all the time that have taken financial risks on a personal and corporate level and failed spectacularly.

All of them had huge self belief.

For every success, there are 100 failures.

The ones that "win" are not just the 1 in 100 that succeed, but also the the ones that fail but use the experience to their benefit and have no regrets, because at least they gave it a go.

Unless you do it, you will never know the answer to your question. Just make sure you can cope with all of the potential outcomes.

jjones

the house always wins

why not set a weekend (or whenever the people who are worst at poker tend to play) and a £1000 budget. allow for two eight hour days and see how it goes.

rather than a **** or bust approach at least this way the potential loss is limited and it will provide a valuable insight as to playing as a pro.

Neanderthal

iTrader: (6)

Go for it Saxo, you’ve little to lose’

LG John

That’s some good advice //oo\\ IIRC a large percentage of millionaires have tried, failed and been flat broke at some point. I guess a lot of people need to scrape around in the bottom of the pan to discover what they are really made of.

I think you are also onto something by applying something of a backward logic to risk assessment – i.e. will I/how much will I regret this if it goes totally **** up. I think at a personal level I’d probably suffer some short-term regret but I’d say that would be primarily born out of the sense of failure rather than a true assessment of whether I was right to take it on in the first place. It’s also interesting that the vast majority of my life regrets (not that I have many) are things I haven’t done/tried as opposed to ones I have.

In fact, the only thing I sort of regret doing is going to university but I believe that’s largely because I have an over-riding regret of the course I did and the activities ( ) I didn’t do at uni.

Perhaps as a sub-theme we could discuss “Key Reasons for Failure”. //oo\\ says he knows many people that have failed when taking risk. Why? What do you believe to be their cause of failure. Lack of preparation? Over-confidence? Lack of commitment? Etc?

Prasius

iTrader: (1)

B).

Risk is fine but you have to consider the full implications of any action and do what you can to negate any 'danger'.

To rush into something is the action of an idiot and a dead man!

davyboy

Love it

Your an addicted gambler - seek help before it all goes **** up.

HTH

Brendan Hughes

Could you keep it up? You do it at present for the fun I think - could you really enjoy it as a job, year after year?

I have no idea about the symptoms or causes of addiction, I don't know if doing it more would make you a gambling addict (they exist) or would make you bored/immune. (But I get the impression that if you were to be an addict, you'd be one by now!)

And would your risks increase the more you got known? At present I assume you're playing anonymously - if you get a reputation, do you then start playing with the big boys (as the little boys don't like you any more) and then your house is on the line?

No idea, but some thoughts for you

///\oo/\\\

Many, many things can contribute and occasionally there are circumstances outwith the control of the parties concerned, but generally they can all be categorised under the heading of "A surplus of confidence over ability".

Its really that simple.

3 categories of people tend to be the ones that succeed.


1) The highly intelligent - common

2) The extremely talented - the majority

3) The very lucky - occasionally.

john banks

I'd also go for b.

One thing I've learned is that the grass always appears greener on the other side. Other income opportunities arise, but generally what you are trained and experienced in should be able to reward you well if you put your skills towards that.

I've considered or dabbled in all sorts of schemes that had the potential to make money if the conditions were perfect or continued to be favourable. Now I'm cynical, and the better for it IMHO from the experience as above.

However, a lot of these fads may not be around in years to come, are susceptible to changes in market conditions or legislation, or simply relevance in future.

///\oo/\\\

There are, of course, ways to mitigate the risk

LG John

Jjones you can't learn anything in a weekend or even two though. In poker terms you need at least 200 hours at a given level to have any confidence in the statistical infromation you can glean from your play.

I could obviously work 16h weekend and pick up 4-8h during the week nights playing poker but this would leave very little time for me and my partner

SJ_Skyline

In your shoes, I wouldn't - why spoil your hobby by making it your profession?

LG John

Just to update: I see poker very much as a source of income. I don’t find myself ‘itching’ to play or missing it if I don’t play (thus I’m not addicted). I actually have to force myself to sit down and play as I’ve played soooooooo many hands that nothing is new or particularly exciting for me. I still enjoy it though and moreso than my job. Most player that go pro and make it tend to put in fairly heavy hours (30-40 a week (that’s heavy for poker)) in the first few years but because they are winning players they move up the levels and eventually can achieve an hourly win rate that allows them to back right off the hours and still make fantastic money. Thus when looking at a career as a poker pro you shouldn’t be thinking in terms of 35h a week, 45 weeks of the year for 40 years.

TopBanana

In this country, the vast majority of people are very risk averse, and they often get stuck in dead-end jobs paralysed by fear of losing their home and car.

Having said that, there has to be a decent upside to taking a risk. You can only quantify the upside according to your own goals. Normally it's money, status and lifestyle.

LG John

There is a saying in poker that the 10th best poker player in the world is still a fish (losing player) when seated with the 9 best poker players in the world. I follow that statement quite religously. My mates who are all very able poker players regularly play home games that I do not take part in. They are a good social event and great fun but I know that standard will make profiteering difficult and thus I'd rather use those poker hours to skin poorer players online.

This is very true: Poker the game has been around for many years and its popularity is growing and growing but there is a lot that could happen to totally torpedo online poker. New Amrican legistlation sneaked in under some Ports Bill has made it very difficult for American's to play online poker and whilst the UK is showing a degree of support for online gambling it may not last for ever. Then there is the risk of cheating and bots growing in complexity, etc.

RichWalk

Age plays a part in these sort of decisions, as I have got older I wouldnt say my propensity for risk has diminished but my need for basic comfort and security and in my private life less dramatic change, have increased. I have a steady partner but no children so its much easier to be risk orientated at w*rk and if I really get to the point where I have had enough I could get by without harming too many significant others.

At the end of the day you only get one chance at this life, you cant take it back!!

In business I do 'gamble' but based on instinct and experience, whether you regard what you are considering the same type of gambling, I really dont know

LG John

This one sentence totally embraces the "PUSH" factors for me wanting to try something else.

You say in this country though. Are other countries different in their attitudes to risk?

Luan Pra bang

I don't see how one has to be exclusive to the other if I was 100%convinced of sucess at a rate of £30 per hour Afer work I would spend at least 5 hours per day on poker to test my theory and assumptions out. I would also do at least 12 hours on a sunday and saturday. Playing ten hours a week and ten hours a day at any game with a significant chance element will dramatically increase the chances of the probabilities and statistics involved haveing more effect and revelvence on the game.
I would also suggest in your case that your job will pay much better returns in the long run based on how much I have payed planning consultants. So on my interpritation of risk by focusing efforts on your current job you have a skill that will always be in demand, reasonable salary and potential for getting big money working as a consultant in the private sector in the future. If you go the alternative and play poker you may or may not earn some ready cash.
Anaylizing risk should not be about the pipe dream of easy money its more the practical pros and cons of any situation.
In my personal life I do take a few calculated risks but I wouldn't be able to pay the mortgauge otherwise and all this is done with the knowledge that I can hit my dad up for cash if I need to.

LG John

Another interesting point and at a personal level something of a driving force as well. Plans are to be married in June/July 2008 and at near 30 (then) I think children will be on the cards not too long after that. I’m not a dad so I don’t know but I’m guessing I’ll be 10x more risk averse with a young one(s) than I am now!

fast bloke

It depends how you define risk. A new business venture is risky in that it could fail and leave you penniless, but it can usually be made sucessful if you have knowledge, preparation, focus and commitment. A little bit of luck will help, but it won't be required. With poker you will always need a little bit of luck. You can't plan for that. As you say, you will need a reserve of 10k to cover bad months. What if you have 2 or 3 bad months in a row. I know it is unlikely, but it isn't impossible. Do you have a plan B to cover such eventualities?

David_Dickson

Aye, you dont always have to succeed to be a winner. I used to be very reserved in my outlook and was averse to change, but then decided that life was too short to be stuck in a rut. Whats the worst that could happen? loose your job, maybe even loose your house? ok, thats not ideal, but its not the end of the world, you will always have options and its never impossible to start again. If you have a partner who cares abiout you, they should be able to believe in you and understand this.
I never really knew my grandfather, he died when I was young, but he was always giving some business venture a go. Some failed spectacularly and left him penniless, but some succeeded spectacularly and left him very rich indeed. When the going was good, he would often give it all up just for a change. When he retired, he had enough to be comfortable, but certainly wasnt wealthy. On the up-side, he lived one of the richest and most varied lives I could imagine.
For me now, being happy is more important than being rich. I gave up my well paid job, city-centre flat and fast car and now live in France where I work in return for board and lodging. Im happy this way though.

LG John

LBP: I have and am continuing to test those theories but it can be really difficult to push those sorts of hours and still have anything of a life! I guess if I found my day job fulfilling it would be easier but I don’t and a find I need a considerable amount of relaxation, drinking, film watching, etc time. The last 3 months (and ongoing) I’ve been redeveloping the house which has crippled my hours further.

I know it sounds easy – I’ve done the maths myself. “If I get in and work an hour before tea and then 2 hours afterwards and then get up at 10 on a Sunday and work till…..” but in practice I wake up at 10 on a Sunday and want to feel my g/f’s boobies in the hope of some action. Poker is pretty far from my ‘what can I do today’ thoughts

TopBanana

Spot on

LG John

I like that post David D – it’s a feel good post

Reading the responses and thinking about things deeper I find myself wondering if a lot of ‘risk aversion’ is in fact ‘fear of the unknown’. How often is there ‘real’ life changing risk involved in decision making? So you might lose a fancy car or have to move house or have to work a job you don’t like just to get back in employment but it’s not like jumping out a plane with a 50% chance your chute was packed correctly. There is no reason why you can’t be happy in a less expensive house or car but I wonder if the fear of that change is often misinterpreted as a sense of risk.

Incidentally the sceptic in me wonders if schooling, TV, etc, etc tries to condition us to be risk averse. Sometime when I’m going to work (Laura drives) I watch the world and people go by and I really get the impression that the vast majority of the people I see are, as Top Bannana says, “paralysed by fear”. Drones just going around their business with no real vision for their lives other than, ‘what will I make for tea’ tonight? They work a job, pay taxes and NI, spend money in the economy to try and relieve the boredom of their lives and then bring up the next generation to repeat the process. Food for thought…

TelBoy

I could go on and on about propensity for risk, given that in my industry it's the be-all and end-all of what we do.

But the deeper question, surely, is why you're still asking these soul-searching questions, Kenny? I've seen them on and off on SN for several years now. Why not DO something radical and see how you feel about it? You might find that a "normal" existence is what you're actually comfortable with, but don't you at least owe it to yourself to find out?

David_Dickson

Aye, the UK life seems to be centred on getting a job, getting a house, getting a car, getting a flatscreen tv, having kids, getting them a playstation......We are conditioned to be consumerists who put up with their lot without complaint.
Yes, thats one way to live a life, but its not the ONLY way. You dont have to give it all up and move into a caravan up a mountain somewhere with no electricity and be a goat-herder (I know someone who did this btw!) but at the very least, be open to the idea of doing something a little different if it makes you happy. If it doesnt work you can always go back to your old life, but at least you TRIED.

TelBoy

Yes yes David

LG John

My hands are up – that’s a fair post.

It’s not fair to say I’m doing nothing, it’s just that the process of change for me is far slower than other people Fear is still the big factor – I’m not quite paralysed by it but I’m certainly crawling along the ground because of it

TelBoy

That's the point, i think you need to just go mental and take a leap into the unknown, as if you continue to weigh up the pros and cons you could find yourself procrastinating for many years to come...