3 ms·

the parents in the article appeared somewhat smart, only tying a fraction of their life savings into their trading.

• choeger 6y ago
  That's what they told the daughter. Once they lose some money, I bet you they will consider taking more out of their conservative funding to "recover the losses". It's really like gambling. Starts harmless and may not be addictive to everyone, but it can definitely ruin your life.
  • Frost1x 6y ago
    Investing is quite literally legalized gambling, just for more complex systems. You're gambling that when you invest money in something it will show value, others will acknowledge that value, hopefully at a higher value than you bought in at, and your investment will increase in value. Obviously with gambling, it's more stochastic in nature by design but often large complex processes have a lot of stochastic elements to their successes and failures as well.
    • leetcrew 6y ago
      investing can be quite like gambling psychologically, but it isn't necessarily the same thing. it's just one of the many risk vs. reward tradeoffs inherent to life. every time I drive to the grocery store, I am implicitly acknowledging that the risk of being t-boned is outweighed by the reward of having food to eat, even though I am not 100% sure that I will survive my journey or that they will have the food I want. another key difference is that the expected value of a bet in gambling is less than or equal to zero (depending on house cut). the expected value of a single stock is unknown (at least to a retail investor), but the expected value of a broad portfolio is positive in a growing economy. you can "lose" relative to others and still be better off than if you had not participated.
      • timmytokyo 6y ago
        It's difficult to call what many of these people do "investing". It's closer to speculating. And speculating is gambling.
        • leetcrew 6y ago
          in this case I agree, what these people are doing is effectively gambling. I'm just pushing back on the frustrating meme that "investing is literally gambling". there are definitions of "investing" and "gambling" that can make that sentence true, but they are not particularly useful outside of convincing laypeople not to put their life savings into $TSLA weeklies. it's certainly possible to gamble with stocks and derivatives, but in general, investing and even speculating are not necessarily gambling. imo the difference is in the strategy behind the trades. though wildly risky, speculation can be rational when backed by an advantage in information and/or analysis. a retail investor watching daily prices and backfitting a narrative from news stories is not an example of a rational trading strategy.
          • chii 6y ago
            The difference between speculating and gambling is that when you speculate, you deliberately take on risk (that someone else wants to offload) for a reward. Gambling is taking on a risk to get a reward - the risk isn't offloaded by somebody else. It's set by the house. For example, horse race betting, roulette, or blackjack, is gambling, not speculating. Betting on commodities futures is speculating, not gambling - commodities futures is one way a producer can offload future price fluctuations/risk to somebody else (who "wins"/"loses" if the prices rise/falls).
    • mellavora 6y ago
      well, except for the zero-sum aspect (i.e. investing is not necessarily a zero-sum game while poker is)
    • howling 6y ago
      Keeping your wealth as money is also gambling (you're betting against high inflation rate).
      • janpot 6y ago
        What is "not gambling" then?
      • tempestn 6y ago
        https://comb.io/yHqJ2w https://comb.io/yHqJ2w "Oh, well, no. Neddy doesn't believe in insurance. He considers it a form of gambling."
  • amaccuish 6y ago
    Like Kokaine, it's middle-class gambling