David Einhorn discusses Psyche of a Billionaire Poker Player


Following his recent third place finish in the Big One for One Drop, David Einhorn has become one of the hottest stories in the poker world. The Greenlight Capitol hedge fund manager earned $4,352,000 for taking third place, and he donated the entire amount to the One Drop foundation.

Seeing as how Einhorn is an investor, you might think that he’s just some random billionaire who luckboxed his way into a good finish. However, the truth is that the New Yorker has become very good at relating poker to his investing business. Einhorn explained this by saying the following:

There’s some information you know, there’s some information you surmise, and then there’s the future which is the unknown information and you have a range of possible outcomes.

If you think about a poker hand that way, you have your cards, you have what you can surmise about whatever your opponents might have and then you have whatever cards might come on the board that are uncertain. So there’s a range, and you’re calculating through those three pieces of information.

And when you invest, it’s really the same. There are the things you know about a company or the world or whatnot, and there are things that you surmise — you don’t know, but you kind of assume –and then there’s the future, which is the range of possible events in the future. And then you think about how do those three things put together affect an investment, which isn’t all that different from how something might affect a poker hand.

As you can see, David Einhorn definitely seems to know more about poker than one would think. He uses his knowledge of investing to profile players and consider their range of hands.

Now one thing that many people may not realize is that this isn’t Einhorn’s first time around the block on the poker tables. He’s cashed in three other live poker tournaments – including an 18th place finish in the 2006 WSOP Main Event ($699,730).

In all, Einhorn has collected $5,107,352 in live tournament winnings, which ranks him 73rd on the all-time money list. And this isn’t bad at all for a guy who spends most of his life trading stocks!