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Your definition of "casino" bet is bogus. Requiring an investment to be a hedge against another investment to not be considered a bet is arbitrary and nonsensic

• trhway 10y ago
  >Requiring an investment to be a hedge against another investment to not be considered a bet not to be considered a "casino" bet. You added generalizations which clearly weren't in my post. I was talking about buying put options (CDS, derivatives) without having comparable exposure to the risks in the underlying assets. >is arbitrary and nonsensical. Having or not such mentioned above exposure defines clearly opposite set of interests and behaviors in the market, and thus provides a significant and valid characteristic to separate those 2 classes of investors and investments. People who buy insurance for their homes have completely different interests from the people who would buy a CDS for the real estate of the town without owning any real estate in the town - the later would profit handsomely if the town is completely burned by a fire while no fires during contract period of the CDS would mean total loss of their bet. Seems like a casino bet, only on big fire event instead of a 36 black.
  • hueving 10y ago
    Nope, all you've described is another type of investment. Buying stock in a company assumes many outcomes that could be very negative for other parts of the economy. If I buy stock in a tobacco company, it's not to offset an exposure to a comparable risk. And it's also a bet against the broader health of society. Either all investments are casino bets or none of them are. Anything else in between is just subjective bullshit.