Hedge Funds and Poker?

September 27, 2008

Manro Haydan is a London trading business who has decided that somehow they are going to be able to make money from online poker. Having been accused of turning the stock market into a casino, one trader says that he can do that by turning casinos into markets.

Chris Smith is the head of Manro Haydan, and he says that they are simply employing traders for a cut of profits. They make money from futures, options, or foreign exchange. They are going to hire more than 150 “traders” to gamble over the internet.

They are a privately owned company and invest for their own account, and they think that they can use the same principles and rules that they apply to money management to poker. The only real difference is the idea of funding them. Usually poker players fund their own accounts so that they don’t have to share profits with anyone else.

Smith says that they are going to have a tough time getting these “traders” as most of them are going to want to fund their own hands. However, some might find the concept exciting and give the company a shot.

There is another hedge fund manager with a similar idea, but they don’t know how successful they will be as a competitor. The company believes that by applying sophisticated risk management techniques like they use in money management in a poker game that they can change the odds. Sometimes that is all you need.