Market Wizards: John Bender

There are a lot of similarities between gambling and trading, although gambling is a bad term because it implies that your results depend on luck. The people that I'm talking about look at poker or backgammon as a business, not a game of chance. There are a few things that are essential to success in both trading as well as playing gambling games as a business. First, you have to understand edge and maximize your edge. Second, you have to be able to deal with losing. Third, you have to understand gambler's ruin---not playing too big for your bankroll. As a professional gambler or as a trader, you are constantly walking the line between maximizing edge and minimizing your risk of tapping out.