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I think the devastating problem today is that because investing and trading can be done responsibly, that all forms of investing and trading are ok even if it’s

I think the devastating problem today is that because investing and trading can be done responsibly, that all forms of investing and trading are ok even if it’s nothing more than gambling. People see a few success stories like DFV and it becomes a new American dream: get rich quick by shrewdly allocating a bit of capital. But most people are just being fooled by randomness.

lotsofpulp 5y ago
What is DFV?
- ddorian43 5y ago
  DeepFuckingValue is his username
- tux3 5y ago
  The person behind the Gamestop (GME) saga.
- djbebs 5y ago
  DFV stands for /u/deepfuckingvalue a reddit user who became famous for his bullish investment on gamestop which resulted in him becoming a multi-millionaire. You may know him from his part in the congress hearings regarding gamestop.
  - lotsofpulp 5y ago
    Thanks.
bko 5y ago
I can't find a meaningful distinction between gambling and investing. It's not about knowledge / skill (picking index funds blindly is actually recommended form of investing these days) It's not about odds (lottery with positive return is gambling, and insurance with negative return is not) It's not about frequency (we're encouraged to contribute to 401k on every paycheck but not to play the lottery every week) And to top it off, if you have a positive expected return on gambling (pro poker player, hedge fund manager), it stops being gambling either. https://mleverything.substack.com/p/gambling-versus-investing https://mleverything.substack.com/p/gambling-versus-investin...
- Closi 5y ago
  Well there is a meaningful difference between gambling and investing, but probably not between gambling and day-trading on limited information. Investing is a broad term that ranges all the way from buying a property to lease to short selling GameStop. Investing is technically a gamble, but a characteristic of gambling in common language usage is the ability to get quick returns - we don’t usually use the phrase gambling to describe something that involves a 3% annual return. It’s also not usually called a gamble if you can spread your ‘bets’ enough to provide a high confidence of a low return (eg why the insurance industry isn’t usually called gambling, even though an individual transaction will be a win/loss from a profit loss perspective).
  - pjc50 5y ago
    > why the insurance industry isn’t usually called gambling I feel that both the Lloyds names (https://www.theguardian.com/money/2000/nov/04/business.personalfinancenews1 https://www.theguardian.com/money/2000/nov/04/business.perso...) and the famous https://en.wikipedia.org/wiki/Long-Term_Capital_Management https://en.wikipedia.org/wiki/Long-Term_Capital_Management were engaged in a gambling-like strategy - positive expected return with possible downside vastly exceeding initial investment - even if it doesn't "feel like" gambling. But there isn't really a good phrase for that. Finance people sometimes say "picking up pennies in front of a steamroller".
    - Closi 5y ago
      Yeah, I think I'm just saying if you use a broad enough definition for gambling then everything in the world is gambling through a certain lens (i.e. Apple are gambling that a nuclear device doesn't get detonated in Cupertino).
- pjc50 5y ago
  It's a distinction of degree; is crossing the road gambling? Or is it an extreme sport given that it's a physical activity with a risk of death? No, that just renders the categories useless. One of the sibling comments talks about adrenalin; perhaps (and this is only half joking) it's like the "sexual content" censorship boundary in that it's only bad if people enjoy it.

lotsofpulp 5y ago

What is DFV?

ddorian43 5y ago
DeepFuckingValue is his username
tux3 5y ago
The person behind the Gamestop (GME) saga.
djbebs 5y ago
DFV stands for /u/deepfuckingvalue a reddit user who became famous for his bullish investment on gamestop which resulted in him becoming a multi-millionaire. You may know him from his part in the congress hearings regarding gamestop.
- lotsofpulp 5y ago
  Thanks.

bko 5y ago

I can't find a meaningful distinction between gambling and investing. It's not about knowledge / skill (picking index funds blindly is actually recommended form of investing these days) It's not about odds (lottery with positive return is gambling, and insurance with negative return is not) It's not about frequency (we're encouraged to contribute to 401k on every paycheck but not to play the lottery every week) And to top it off, if you have a positive expected return on gambling (pro poker player, hedge fund manager), it stops being gambling either. https://mleverything.substack.com/p/gambling-versus-investing https://mleverything.substack.com/p/gambling-versus-investin...

Closi 5y ago
Well there is a meaningful difference between gambling and investing, but probably not between gambling and day-trading on limited information. Investing is a broad term that ranges all the way from buying a property to lease to short selling GameStop. Investing is technically a gamble, but a characteristic of gambling in common language usage is the ability to get quick returns - we don’t usually use the phrase gambling to describe something that involves a 3% annual return. It’s also not usually called a gamble if you can spread your ‘bets’ enough to provide a high confidence of a low return (eg why the insurance industry isn’t usually called gambling, even though an individual transaction will be a win/loss from a profit loss perspective).
- pjc50 5y ago
  > why the insurance industry isn’t usually called gambling I feel that both the Lloyds names (https://www.theguardian.com/money/2000/nov/04/business.personalfinancenews1 https://www.theguardian.com/money/2000/nov/04/business.perso...) and the famous https://en.wikipedia.org/wiki/Long-Term_Capital_Management https://en.wikipedia.org/wiki/Long-Term_Capital_Management were engaged in a gambling-like strategy - positive expected return with possible downside vastly exceeding initial investment - even if it doesn't "feel like" gambling. But there isn't really a good phrase for that. Finance people sometimes say "picking up pennies in front of a steamroller".
  - Closi 5y ago
    Yeah, I think I'm just saying if you use a broad enough definition for gambling then everything in the world is gambling through a certain lens (i.e. Apple are gambling that a nuclear device doesn't get detonated in Cupertino).
pjc50 5y ago
It's a distinction of degree; is crossing the road gambling? Or is it an extreme sport given that it's a physical activity with a risk of death? No, that just renders the categories useless. One of the sibling comments talks about adrenalin; perhaps (and this is only half joking) it's like the "sexual content" censorship boundary in that it's only bad if people enjoy it.