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> but is this "gambling"? I don't think so. Of course it is, because you can't predict the future. You could have just as easily lost money investing in indivi

> but is this "gambling"? I don't think so. Of course it is, because you can't predict the future. You could have just as easily lost money investing in individual stocks, even ones that seemed like no-brainers at the time. Why do you think you're better than most other investors at making those investment choices?

mikestew 7y ago
Why do you think you're better than most other investors at making those investment choices? Not OP, but the simple answer is: “because my returns over the years prove that I can.” I’ve heard this question enough times over the years that I usually just ignore such silly questions and go back to buying deep-in-the-money AAPL calls. Conversely, if it makes one feel better, continue to tell yourself individuals can’t beat the market (which is mostly true).
- doliveira 7y ago
  It's like you copied the definition of a fallacy in your comment.
- RussianCow 7y ago
  > Not OP, but the simple answer is: “because my returns over the years prove that I can.” But I could make the same argument as to why my "strategy" playing slots or roulette is good, but in reality it just means I've gotten really lucky, and I might wipe out all my earnings in the span of an hour if that luck suddenly turns. That's not to say there aren't legitimately profitable trading strategies—"you can't beat the market" is, strictly speaking, demonstrably false—but "buy stocks of companies I like" is not one of those, and is entirely equivalent to gambling.
  - mikestew 7y ago
    Lucky is making a few trades that went well. When one can do it consistently for twenty years, is it still luck? Yeah, maybe it’s luck that deep-in-the-money AAPL calls (as one example) consistently make money. Maybe my occasional “disaster” strategy (buys calls for UAL, Equifax, et. al., after bad press that’ll blow over) is luck. But, man, both examples consistently work. /shrug Anyway, I have little desire to repeat the same old arguments, nor convince anyone else. However, one might consider the differences between a slot machine (which tells you up front that you will lose money in the long term, and has no stop orders) and trading equities. Or don’t, matters little to me because I have no argument to win.
    - jldugger 7y ago
      > When one can do it consistently for twenty years, is it still luck? If you take a few million people and have them invest in put or call options every year, you're still going to have some streaky winners after 20 years. Very few individual investors I have talked to have convinced me they are even tracking results well enough to back their claims of outperformance.
tempsy 7y ago
Life isn’t risk free. Just because you can’t predict something doesn’t mean it’s inherently gambling. But if that is your definition of gambling then every human gambles every single day just by living. Personally I don’t think minimizing risk as far as I can is a particularly enlightened or interesting way to live ones life, but to each their own. Certainly this past decade rewarded risk takers.
- et2o 7y ago
  Best to compare it to a known and easily accessible baseline such as index funds / passive investing. You are gambling relative to passive investing, in that you hope for higher returns but statistically you will achieve lower returns. Not that complicated.
  - tempsy 7y ago
    To each their own. Clearly I have a higher risk tolerance than you, and over the last decade it’s paid off handsomely. If it’s gambling so be it. I guess I gambled and won.
    - et2o 7y ago
      I was not commenting about myself. Simply correcting your mistakes. You are not a very sophisticated retail investor and it’s wrong for you to opine to others like this in the face of substantial evidence.
  - mrep 7y ago
    Maybe median wise, but not mean. Most ETFs still have fees and they use Authorized participants to make the trades from individual stocks to the ETFs and thus they are also taking a cut. Investing yourself using a no fee broker involves no middleman whatsoever so it cannot possibly achieve a lower return in aggregate.
    - et2o 7y ago
      Yes, of course ETFs take a cut. They are not run by non-profits. They are still a reasonable baseline and standard marker for the broader market, given their typically quite small management fees. More importantly are you suggestinging individuals buy and weight all components of an ETF like VOO (500 stocks) themselves? Pretty ridiculous. Tracking error is real and there is an extreme time cost which makes hypothetical strategies like that unreasonable for most investors. I also just don’t understand what your comment has to do with mine in the first place.

mikestew 7y ago

Why do you think you're better than most other investors at making those investment choices? Not OP, but the simple answer is: “because my returns over the years prove that I can.” I’ve heard this question enough times over the years that I usually just ignore such silly questions and go back to buying deep-in-the-money AAPL calls. Conversely, if it makes one feel better, continue to tell yourself individuals can’t beat the market (which is mostly true).

doliveira 7y ago
It's like you copied the definition of a fallacy in your comment.
RussianCow 7y ago
> Not OP, but the simple answer is: “because my returns over the years prove that I can.” But I could make the same argument as to why my "strategy" playing slots or roulette is good, but in reality it just means I've gotten really lucky, and I might wipe out all my earnings in the span of an hour if that luck suddenly turns. That's not to say there aren't legitimately profitable trading strategies—"you can't beat the market" is, strictly speaking, demonstrably false—but "buy stocks of companies I like" is not one of those, and is entirely equivalent to gambling.
- mikestew 7y ago
  Lucky is making a few trades that went well. When one can do it consistently for twenty years, is it still luck? Yeah, maybe it’s luck that deep-in-the-money AAPL calls (as one example) consistently make money. Maybe my occasional “disaster” strategy (buys calls for UAL, Equifax, et. al., after bad press that’ll blow over) is luck. But, man, both examples consistently work. /shrug Anyway, I have little desire to repeat the same old arguments, nor convince anyone else. However, one might consider the differences between a slot machine (which tells you up front that you will lose money in the long term, and has no stop orders) and trading equities. Or don’t, matters little to me because I have no argument to win.
  - jldugger 7y ago
    > When one can do it consistently for twenty years, is it still luck? If you take a few million people and have them invest in put or call options every year, you're still going to have some streaky winners after 20 years. Very few individual investors I have talked to have convinced me they are even tracking results well enough to back their claims of outperformance.

tempsy 7y ago

Life isn’t risk free. Just because you can’t predict something doesn’t mean it’s inherently gambling. But if that is your definition of gambling then every human gambles every single day just by living. Personally I don’t think minimizing risk as far as I can is a particularly enlightened or interesting way to live ones life, but to each their own. Certainly this past decade rewarded risk takers.

et2o 7y ago
Best to compare it to a known and easily accessible baseline such as index funds / passive investing. You are gambling relative to passive investing, in that you hope for higher returns but statistically you will achieve lower returns. Not that complicated.
- tempsy 7y ago
  To each their own. Clearly I have a higher risk tolerance than you, and over the last decade it’s paid off handsomely. If it’s gambling so be it. I guess I gambled and won.
  - et2o 7y ago
    I was not commenting about myself. Simply correcting your mistakes. You are not a very sophisticated retail investor and it’s wrong for you to opine to others like this in the face of substantial evidence.
- mrep 7y ago
  Maybe median wise, but not mean. Most ETFs still have fees and they use Authorized participants to make the trades from individual stocks to the ETFs and thus they are also taking a cut. Investing yourself using a no fee broker involves no middleman whatsoever so it cannot possibly achieve a lower return in aggregate.
  - et2o 7y ago
    Yes, of course ETFs take a cut. They are not run by non-profits. They are still a reasonable baseline and standard marker for the broader market, given their typically quite small management fees. More importantly are you suggestinging individuals buy and weight all components of an ETF like VOO (500 stocks) themselves? Pretty ridiculous. Tracking error is real and there is an extreme time cost which makes hypothetical strategies like that unreasonable for most investors. I also just don’t understand what your comment has to do with mine in the first place.