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It’s a fact that all financial investments have risks. Ninety percent of people who enter into trading will end up losing their money. So what is it you’re doing wrong? These people do not have a good enough understanding of what’s going on in the situation, simply put. In a way, entering into investments is akin to playing a game of poker.

My theory is thus; the game of poker is a good simulation of the investment world, and the correct strategies in winning, or getting to the endgame, at least, is similar in both cases. I admit that this may sound a bit nontraditional, but do hear me out.

You will not get very far when playing poker, if you just hold back and wait for the right hand to invest all your chips in that one single hand. One, even the best hands have a level of risk in it, so you may still end up losing all your chips at the end. Another thing, if you go in, with guns ablaze, you’ll still only end up with a small yield of extra chips.

It’s not a very good move to bet like mad on every single hand, either. If you do this, you’ll come across as not very bright. Constantly exposing the majority of your chips to high risk will eventually lead to a burnout; you’ll be the first one out of the game, having lost all your chips in a few fell swoops.

So what is the right way to play poker? As anyone playing will learn quickly, getting ahead in poker involves more than just considering your own hand and chips, but getting a good feel for the hand and chips of those around you as well. Once you get a good feel of the game table, also know that you can’t put all your chips in one really good hand. Invest your chips little by little, spreading out your game to those of good, but not necessarily great plays.

The same principle applies to trading. The game table is essentially the market, and how it affects your investments. You’ll need to avoid having all your capital placed onto one investment. Spread it out into a number of decent deals, and then if one fails, you won’t be as devastated.