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July 22, 2020

Sam Kirsner

Sam is one of the larger sports bettors in Australia & has been doing it professionally for almost a decade. The wisdom he gained over his career has value for people in similar fields, including trading. He is also just an all-around legend & funny guy & highly recommended friend. There’s an interview of him here:


Intuition & Self Trust:

Sam is heavily reliant on his intuition, on his subconscious picking up the relevant data and sending him a signal to act at the appropriate time. 


My Take & Further Elaboration:

This seems fairly cliche so why is this important? It’s fairly common to see some prop traders continually try to understand every element of a trade, i.e., to develop an entirely conscious and precise criteria for entry and exit. The traders who I’ve met that are like this are not particularly successful relative to those that are comfortable relying on some intuition. (Algorithmic trading is a separate discussion).

Part of what is making this work is not “magic”, but trust in oneself on some fundamental level. One is much more easily able to access those lightning calculations of the subconscious mind. One is much more relaxed and in a state ready to receive relevant information over time. This is confirmed by the backstories of those like Sam and others that I speak to. 


Sam dropped out of school at age sixteen, despite enormous amounts of peer pressure and the risk of being alienated, because he felt that it could not possibly help him in life – “I knew it was all bullshit because this annoying teacher would just tell me things from a book. I wanted to learn things that a machine can’t do.” He describes this as a “knowing.” The point is not a discussion on intuition vs. consciously deliberate thought, but the acting on ones best judgments over time and the self trust that builds (Sam’s backstory is littered with examples like this of doing unconventional things when acting on his judgement). Another highly successful trader I know was a competing boxer and similarly described this attitude he had of acting on his gut and building confidence in himself over time – to take in relevant information and to act properly. 


Contrast this to a struggling trader that I know who questions intuition. Every loss overwhelms his subconscious with doubts and reduces his observational skills throughout the day. This trader cannot have as much access to his intuition as Sam or the boxer trader I know. It’s like the writer who constantly edits as he writes and consequently blocks of thoughts and ideas from properly developing; whereas Sam and the boxer trader are like the stream-of-consciousness writers who edit and rearrange later, at an appropriate time. The fact is that access to intuition is essential to capture and respond real-time to the enormous amount of constantly-changing information. And trust in intuition (oneself and one’s judgement) is also essential to prevent one from constantly re-tailoring his approach on the basis of the last loss.


Primacy of Experience:

He learns from experience, by betting on different races and getting feedback. Back when he dropped out of school at age 16 he went to the betting shops and started betting. He did not know that many details about all the horses and still to this day does not. 


My take:

I’m emphasizing this because you’ll see people who often approach trading by trying to network or by trying to research or trying to theorize. All of those are fine and may be necessary at points, but the primary skill is the actual act of sitting, observing and trading (or in Sam’s case, betting). The success of this approach is also confirmed by our boxer trader friend who, rather than spending too much time theorizing, just goes out into the world and tries new things, e.g., he wants to learn to trade stocks so he just opens an account and starts thrashing about in the stocks first. He later spends a bit more time thinking, learning and adjusting in a more fine tuned manner. Others will often excessively research this before even entering the space. 

One justification I can think for this is the feedback you get an can adjust to (which is necessary due to the more nuanced nature of reality); another is that what you thought may be an option is not actually an option, and you go out and discover that much quickly by acting and experiencing in a way where you can cap downsides; vs. spending many days or weeks researching and either the thing not being possible or eventually losing motivation to even act.


Handling Wins & Losses:

Sam attributes a large part of his success to how he handles both wins and losses. He is not thrown off by one loss or a string of losses. In his mind, there’s a range of what’s a normal amount to be losing in a given context. Same for winning. He says: “you should expect terrible results—it’s a matter of when, not if” & “it’s not the ability to picking the winning horse but how I handle winning & losing.”


My take: 

I often see traders (myself included) over-adjust their approach on the basis of a recent loss or win. The equivalent to this in algorithmic trading is over-optimization, i.e., tailoring your strategy to the specifics of the last trade which will actually never repeat in the same manner. Sam steps above this and thinks in ranges. He has an expectation of how much he might lose or win on a given day for a given context and so when within the range he is not worried or questioning his own ability and strategy. This allows more free flowing access to his subconscious—which is essential to his success. And even on those days he does breach the range of what is a normal loss, he is again not necessarily panicked or worried, since he has already been through situations where he needs to reinvented himself. Taking losses and reinvention are part of the game. 


Health/Diet:

  • Fasts a few days a week. He finds it improves his level of focus.
  • Notices that sugar makes him bet too aggressively.

Self-Knowledge:

  • As above, he’s able to isolate and identify specific causes of his behavior, e.g., sugar leading to aggressive betting.
  • He notices what he does during the week and how that relates to trading. If he’s at home all week and never leaving the house, he’ll bet badly; if he’s happy and has exercised then he’s not coming to gambling with an intention other than making money; if he hasn’t got the excitement that he wants during the week, he’ll seek it from trading—which is a mistake. So observing this in himself and knowing it he structures his week appropriately.

Schedule:

  • Even though Sam only gambles roughly two days a week his whole week is structured to improve the performance on those two days. He makes sure to fulfill those needs he has for excitement, exercise, etc., before he comes to bet. 
Posted in Legend Notes