Difference Between Trading Stocks And Gambling

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Can you explain the difference between gambling and investing? Thanks in advance.

  • Differences Between Forex Trading and Gambling Numerous attempts have been made to simplify trading in the forex marke t, and while a degree of success has been achieved in this area, trading forex is more than installing a trading platform, funding an account and clicking a buy or sell button on your computer.
  • May 08, 2009  There is a big difference. Gambling is just playing by hazard, but trading stocks is about learning how to take advantage of trends and cycles. If you know how to trade stocks, it's like playing black jack by counting. And the best thing is that this is very legal.
  • The key difference between stock trading (whether it is long-short term) and gambling in a casino is the amount of data that affects stock prices. Market psychology, statistics, news + many other variables (in one form or another) are available to you. You determine what affects the price of a stock.

Thank you for your e-mail and question about the differences between gambling and investing. There are a number of Christian authors who have addressed this issue (Norm Geisler, Tony Evans, Gary North, etc.).

Toss a coin and watch all the proffered differences between gambling and trading disappear into thin air. Easy money is the same on Wall Street. Toss a coin and watch all the proffered differences between gambling and trading disappear into thin air. Easy money is the same on Wall Street. Gambling is time-bound. The concept of time is another key difference between stock investing and gambling. Gambling is a time-bound practice, but stock investing can last several years. In gambling, once the game or hand is over, your chances to make more profit from your wager are closed.

Briefly let me say that there are some similarities, and there are people who get addicted to high risk investing just like gambling. So I would acknowledge there are some similarities between the two.

But the key issue is that there are some striking differences. Investors research an investment with the goal of lowering the risks and making a wise investment. Gambling is all about risk and the odds cannot be lowered by further research (except for those who can modify the odds of blackjack by card counting or something like that).

The goal of investing is to build up a company and portfolio. Even if it’s done selfishly, it still can have a positive effect on the company and the economy. Gambling takes money out of the capital economy. It doesn’t contribute to job creation, etc. As I argue in my transcript on gambling, gambling actually hurts a local economy and increases social costs (abuse, neglect, bankruptcy).

Difference

Most investing is done with discretionary income and with certain limits (amount of stock that can be bought on margin, debt load allowed by a lender, etc.). Most gambling is not done with discretionary income. Money that should go for food, rent, clothing is often risked in a “get-rich-quick” scheme.

Another key differentiator between investing and gambling has to do with time. With gambling, your chance to profit ends as soon as the game is over, while with investing there’s the opportunity of a future income stream in terms of dividends and interest, and there’s the alluring prospect of capital growth and compounding returns over time. Oct 28, 2015 Investing or Gambling, What’s The Difference? Peter Lynch once said, “When people discover they are no good at baseball or hockey, they put away their bats and their skates and they take up amateur golf or stamp collecting or gardening. But when people discover they are no good at picking stocks, they are likely to continue to do it anyway.”.

So while I would acknowledge that investing and gambling have some similarities, the differences make the difference. If you are interested, I would encourage you to read some additional material by some of the authors I mentioned.

Thanks for writing.

Kerby Anderson
Probe Ministries

Buying And Trading Stocks Online

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Day trading is a cousin to both investing and gambling, but it is not the same as either. Day trading involves quick reactions to the markets, not a long-term consideration of all the factors that can drive an investment. It works with odds in your favor, or at least that are even, rather than with odds that are against you.

Dean martin at the latin casino. As a request from the owner of The Latin Casino in Cherry Hill, NJ, Frank asked Dean to accompany him for a month of shows starting with 2 weeks at the Westchester Premier Theater in Tarrytown, New York on May 17, 1977. Next they performed a week at The Latin. The Latin Casino was a Philadelphia-area nightclub that first opened in 1944 at 1309 Walnut Street in Philadelphia, Pennsylvania.Many top entertainers performed at the Latin including Harry Belafonte, Jimmy Durante, Sammy Davis Jr., Dean Martin, Richard Pryor, Jerry Lewis, Milton Berle, Lena Horne, Pearl Bailey, Louis Armstrong, Lionel Hampton, and Joey Bishop. Martin is the subject of Dean Martin's Wild Party and Dean Martin's Vegas Shindig, a pair of video slot machines found in many casinos. The games feature songs sung by Martin during the bonus feature and the count-up of a player's winnings.

Investing is slow and steady

Investing is the process of putting money at risk in order to get a return. It’s the way that businesses get started, roads get built, and explorations get financed.

Investing is very much focused on the long term. Good investors do a lot of research before committing their money because they know that it will take a long time to see a payoff. Investors often invest in things that are out of favor, because they know that, with time, others will recognize the value and respond in kind.

In contrast to investing, day trading moves fast. Day traders react only to what’s on the screen. There’s no time to do research, and the market is always right when you’re day trading. You don’t have two months or two years to wait for the fundamentals to work out and the rest of Wall Street to see how smart you were. And if you can’t live with that, you shouldn’t be day trading.

Day trading works fast

Trading is the act of buying and selling securities. All investors trade, because they need to buy and sell their investments. But to investors, trading is a rare transaction, and they get more value from finding a good opportunity, buying it cheap, and selling it at a much higher price sometime in the future. But traders are not investors.

Difference Between Stock Trading And Gambling

Traders look to take advantage of short-term price discrepancies in the market. In general, they don’t take a lot of risk on each trade, so they don’t get a lot of return on each trade, either. Traders act quickly. They look at what the market is telling them and then respond.

They know that many of their trades won’t work out, but as long as more than half work, they’ll be okay. They don’t do a lot of in-depth research on the securities they trade, but they know the normal price and volume patterns well enough that they can recognize potential profit opportunities.

Trading keeps markets efficient because it creates the short-term supply and demand that eliminates small price discrepancies. It also creates a lot of stress for traders, who must react in the here and now. Traders give up the luxury of time in exchange for a quick profit.

Difference Between Trading Stocks And Gambling Sites

Speculation is related to trading in that it often involves short-term transactions. Speculators take risks, assuming a much greater return than may be expected, and a lot of what-ifs may have to be satisfied for the transaction to pay off. Many speculators hedge their risks with other securities, such as options or futures.

Gambling is nothing more than luck

Difference Between Trading Stocks And Gambling Machines

A gambler puts up money in the hopes of a payoff if a random event occurs. The odds are always against the gambler and in favor of the house, but people like to gamble because they like to hope that, if they hit it lucky, their return will be as large as their loss is likely.

Difference Between Trading Stocks And Gambling And Money

Some gamblers believe that the odds can be beaten, but they are wrong. They get excited about the potential for a big win and get caught up in the glamour of the casino, and soon the odds go to work and drain away their stakes.