Edward Thorp · Math genius who beat the dealer and the market

EP 109: The man who beat the dealer, and later, beat the market – Edward Thorp

I’m not sure how to best say this, but Edward Thorp, is kind of a big deal…

Not only in the world of financial markets, but he’s also a household name amongst the gambling scene. He’s the man who beat the dealer, and later, beat the market.

It was during the late-50’s and early-60’s, when Ed, a math genius and professor at MIT, took on the challenge of discovering a way to get an edge playing gambling games such as blackjack, roulette and baccarat. Long story short; Ed won—and he’s now considered the father of card counting.

From there, the next obvious move for Ed was to take on financial markets—which he also did with a great degree of success. His first hedge fund, Princeton Newport Partners, achieved an annualized return of 19.1% (before fees) over a 19-year period, with 227 of 230 months being profitable—the worst monthly loss being less than 1%.

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[nowaela]

love hearing people who lead the human pack.crazy mind crazy intelligence

[schrodingerscat]

seriously you couldn't have invited a more legendary guest. Chat With Traders is on point. i suppose next we will hear from James Simons, John Taylor, or Myron Scholes

[devonnelson]

This is an exceptional interview. One of the great minds of our time.

[IRON_NIC]

Although this episode was less about market and trading, I find it one of the best and most helpful and interesting overall. Aaron you are doing a great job!

[Yogita]

Very inspiring 👍. Thanks for talj with ed👌

[SirRickYoYo]

Thanks Aaron for the great interview from Mr. Thorp. As you know he is a great hero amongst serious traders. I bought "Beat the Market" back abound the year 2000 for the insight he gives and the motivation. I still read it on a yearly basis more for the scientific mind he put into words in the book. I learned so much listening to this interview, particularly with the Kelly Criterion and happy he graced you with an interview. Thanks for sharing it with us.

[peterp]

I didn't watch the video yet, but this guy is the man, I read about him before !! He knows how to truly headge his investments/trades.

[natanluiza]

This man is one of my childhood heroes. I love to hear him talk about his thoughts in the casino. The way he was thinking about it. Never think about irrelevant things, especially your inner child.

[hiatuz]

OMG I love your show I been listening for over 6hrs today! and many hrs over time! now and this is nextttt :)

[qs]

Expected more views? Mr Thorp is a genius and a champion! 🏆

[Financere]

true genius, to beat roulette, blackjack, and the stock market is quite a feat. But also gives good advice on life. Great interview the only thing i thought should have been asked is how his systems would work in todays market. also in the casino.

[byronrich]

Every time I find a new trader, Aaron’s already interviewed them 🔥

[petermullan]

Love your channel man. Thanks for all the episodes!

[georgemcdowell]

Thanks, Aaron!  Another outstanding interview!  I couldn't wait to listen to this.

[danielzha]

Reading the book right now, insightful and fun.

[nb]

The ads are a bit out of control on this one. Every couple mins makes it difficult to watch.

[billblass]

Hi Aaron!  Great interview!  Follow you religiously!  You said yourself at the outset that you wanted more time with Ed--I couldn't agree more.  Too much time spent on the Blackjack story, which is a whole life story in itself, but, no time spent on what he did in his hedge fund days, and no real delving into trading intracacies--you scratched the surface of a diamond--bring him back!  P.S.  Find out how he looks so young for a man of his age--must have been a very balanced life!  Best always!  Bill Blass

[David-]

Thank you for uploading; insightful questions and good rapport.

[tubewatcher]

Good interview.  Thorp's latest book is very interesting & educational.

[jc]

Wait, he speaks this well at 84 years old ??