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alias2211
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08-04-2006, 08:54 PM
Post subject: leveraging BR money for investments
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#1 (permalink)
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Flush
Join Date: Mar 2005
Location: U, S and A!!!
Posts: 469
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hey guys-
i just emptied the vast majority of my BR to finance a great real estate investment opportunity. (fwiw, i purchased a rental property that was about to be foreclosed and it has an existing lease on it. i'll be netting about $1.5k/mo. on it after everything is said and done, easy peasy). this got me thinking about how other high stakes players deal with external investment strategies as a way to balance against poker's sometimes crazy variance. do any of you guys do like short term CDs with portions of your BR, stock purchasing, mutual funds, etc.? i guess in this instance i'm kissing that percentage of my bankroll goodbye (at least while it's tied up in principal on that property), but i'm wondering how often you guys dip into the BR for investment opportunities.
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gabe
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Moderator
Join Date: Dec 2004
Location: trying to live
Posts: 7,964
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ive been trying to put 10k a month in short term CDs, but thats it
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mb2447
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Straight
Join Date: Jul 2005
Location: NYC
Posts: 122
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great topic.
my BR is far short of it being 'worth it' to start investing, but i recently stashed away a good chunk of change in an Orange ING account (4.35% interest i think), as a kind of safety net against whatever. There's a 3 day processing time for withdrawals, which prevents any impulse purchases or decisions =)
In the meanwhile poker still offers the best return on investment, and my BR is large enough to absorb swings. Once i become a high-stakes baller I'll explore my other options ... insider trading, anybody??
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AWOL.
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ilikeaces86
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4-of-a-Kind
Join Date: Nov 2004
Posts: 2,141
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Until you can play the highest stakes that you have an edge you should just keep investing it in your own bankroll.
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Pingviini
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Full House
Join Date: Feb 2005
Location: Bangkok
Posts: 1,090
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But you can still have some of your BR money in investments. Its not like you need all of your BR all the time if the money from investments is just quicly withdrawable.
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"Poker is a simple math game" -Aba20
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SmackinYaUp
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4-of-a-Kind
Join Date: Dec 2004
Location: B N L
Posts: 1,725
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Any extra money I get in my bankroll goes towards paying off those miserable taxes. Starting paying taxes has really hurt guys.
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He who drinks beer sleeps well.
He who sleeps well cannot sin.
He who does not sin goes to Heaven.
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alias2211
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Flush
Join Date: Mar 2005
Location: U, S and A!!!
Posts: 469
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Quote:
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Originally Posted by ilikeaces86
Until you can play the highest stakes that you have an edge you should just keep investing it in your own bankroll.
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agreed in principle. i'm content at 5-10 right now, have taken legitimate well-rolled - but probably not properly-rolled - shots at 10-25 before only to drift back down to 5-10 BR. so this time instead of taking another shot at the higher stakes on the height of an upswing i decided to realize some of my earnings (and then some for this move) and invest in a long term manner. if i can pick up a few more rental properties in the next couple of years i could go on tilt from hell BUSTO tilt and still be financially secure for the rest of my life.
for those of you doing CDs, what time limit do you prefer? assuming less than 6 month periods, just curious though.
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SmackinYaUp
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4-of-a-Kind
Join Date: Dec 2004
Location: B N L
Posts: 1,725
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I'm really curious to see some replies here...what else do you guys do?
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He who drinks beer sleeps well.
He who sleeps well cannot sin.
He who does not sin goes to Heaven.
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givememyleg
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WHO YA GONNA CALL?!??
Administrator
Join Date: Nov 2005
Location: ISHPERMING MISHIGEN
Posts: 5,042
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Quote:
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Originally Posted by SmackinYaUp
I'm really curious to see some replies here...what else do you guys do?
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kyc12
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Join Date: Jul 2006
Posts: 89
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Quote:
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Originally Posted by mb2447
my BR is far short of it being 'worth it' to start investing, but i recently stashed away a good chunk of change in an Orange ING account (4.35% interest i think), as a kind of safety net against whatever. There's a 3 day processing time for withdrawals, which prevents any impulse purchases or decisions =)
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There are better rates out there:
http://www.bankrate.com/brm/rate/mmm...416&product=33
If you don't want to go through the list, I recommend either Emigrand Direct or HSBC Direct (If you use Citibank they have a good E-saving account as well, but they charge if you move money out to a non-citi account)
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ilikeaces86
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4-of-a-Kind
Join Date: Nov 2004
Posts: 2,141
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Just Open an emigrant direct account and get 5.15% interest if you dont have enough to start real investing.
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ItDepends
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Straight
Join Date: May 2006
Posts: 142
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Hey alias2211, Actually a good post that deserves a long responce.
First off, ilikeaces is right. The best return on your money is moving the money into your bankroll. Eventually you will hit a high level where you can't beat the next level for a comfortable rate. This is different for all players. Some players won't ever be able to beat 10/20, and that's fine. You will know when you hit this wall.
Depending how 'deep' you play. Sometimes there is a lot of extra money to set aside. Opening an online bank account with 5% interest is a great place to store cash assets until you happen to need them for poker. CDs are much less attractive options with the new high rate online accounts.
When you do find you comfort level, you will start building a bankroll much larger then you need to play. You can either do the foolish thing and spend it all (hey, probably funner option also), or you can look into investments.
I currently am looking for positions in the stock market. You can get attractive returns with little work. Index funds are an easy way to stay diversified and keep a good return. More adventurous investors can try to beat the market, but without outside help this is really hard.
I personally hold 100 times my buyin level in cash (with a part in my online banking accounts)and enough money to cover the next few months expences in cash. At the end of the month I move remaining cash into the stock market. If I know I have a big purchase coming up I keep enough cash on hand to pay for it.
The other options are much less illiquid, so for me, they don't seem as attractive. Real estate comes in here. The returns on these investments can be really high, but require more work, and less flexablility. I wouldn't personally recommend starting here if your 5-10 year future is a mystery.
That's my take
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alias2211
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Flush
Join Date: Mar 2005
Location: U, S and A!!!
Posts: 469
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thanks itdepends. i was really curious about the liquidity of bankroll from different players and how the need for access to large amounts of cash can play against some of the value gained by making investments that are not so liquid. so i'm glad you addressed that.
i hadn't considered the higher yields offered by online banks vs. a traditional CD return, that is a good way to look at it. for me, i think the value of having access to a big chunk of change kept in an online savings account far outweighs the hassle of even shorter 3mo. term CDs.
i've personally come to find that i prefer a $40k BR for 1000nl, it just works for me. but that last few times i've gotten up to like $60k and taken a shot at the bigger games, i end up back at $30-40k so i'm going to just keep playing 5-10 and keep pulling out anything over 40k. but i should hope that i'll never need all 40k within such a short period that i _couldn't_ handle having some of it in an online savings account. i guess i'm just fine w/ how i'm doing at 5-10, i'll probably continue to take a shot here and there at bigger stakes. but i'm definitely going to start balancing those high risk endeavors with more stable opportunities like rental properties, roth IRA, etc. i'm gonna try to put 50% of profit in savings and keep 50% around for shots and see how that goes. i'm not ready to give up on higher levels, but i'm ok with the fact that it might take me a little longer to get up there. i'm also ok with never actually making it there, too. i make more from poker than my job now by far so i don't have much to worry about.
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Bmxicle
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Full House
Join Date: Jan 2005
Location: Vancouver
Posts: 947
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I just traffic drugs, i keep about 50k of my br in drugs at any given point and sell them for a nice mark up if i need cash, OBV this is the best investment.
But I GTG RIGHT NOW so i will respond with a real answer later.
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