5 ms·

This just singles out sports betting apps and makes no mention of things like Robinhood, predictit (rip), or the likes. Big whoop

SQueeeeeL 4y ago
Most people are pretty behind the curve on the fact that stock trading is essentially elaborate betting on horse races, but sports betting doesn't have such skewed optics
- filbo 4y ago
  Horses competing or Humans competing, what's the difference?
- adventured 4y ago
  Trading is obviously different from investing. Horse racing has no such comparable as an S&P 500 index fund that will produce solid returns over a very long period of time (such that you can safely allocate N% of your income to it over a lifetime and can expect to do well).
  - GrinningFool 4y ago
    I am certain you just inspired someone to start the first horse race index fund in which fund managers invest diversify by placing low- to moderate-risk bets at horse races around the world.
  - matwood 4y ago
    You can buy fractional ownership in horses as an investment. Buying across a bunch of different horses would effectively be creating your own index.
- sgjohnson 4y ago
  > Most people are pretty behind the curve on the fact that stock trading is essentially elaborate betting on horse races If your drug of choice is deep-OTM weekly options, it suddenly becomes straight up gambling.
- uoaei 4y ago
  I think we should ban all stock transactions that aren't simply buying or selling shares for personal possession. Calls/puts, options, futures, etc. are just bets that are less complicated for corporate investment banks to automate strategies than for individual retail investors, leading to an obvious power and information imbalance that guarantees that the "house" always wins.
  - sitzkrieg 4y ago
    futures have very legitimate use for producers and consumers of commodities. speculators then provide them liquidity but say, people blowing out accounts trading emini sp500 while having no idea what a futures contract is, sure why not
    - uoaei 4y ago
      Producers and consumers can provide their own damn liquidity. It's called "budgeting". This seems to be an explanation ex post facto and not a reason for its genesis. This insane liquidity generation scheme is one of many expressions of the force that drives unbridled exponential growth, which we can now see is in excess of what our environment writ large can sustainably provide. The pursuit of short term money-on-money returns is eating the world, and sycophants who personally benefit are turning blind eyes to this very basic and obvious fact.
  - matwood 4y ago
    Derivatives have a purpose and closing off regular people is just more gate keeping.
- fullshark 4y ago
  That's only when the poor people do it, when VCs/ banks / hedge funds do it they are stewards of future innovation and macroeconomy efficiency experts, guiding our economy towards the activity that returns socially beneficial results.
PaulHoule 4y ago
It's a little different because: (1) Stocks do make money in the long term. If you buy and hold broad ETFs like SPY and QQQ you can do very well on Robin Hood. (2) The cumulative effect of people's speculation helps set prices and allocate capital. Even if many speculators loose, collectively the speculators have excellent judgement. It's as if the sports betting helped decide who wins the game.
- scaredginger 4y ago
  (1) Kinda irrelevant to the point, I feel, and Robinhood's design is (imo) clearly targeting the gambling crowd. (2) Slightly better argument, but retail orders don't have much effect on the market overall.
  - PaulHoule 4y ago
    Some of the reason why market makers will pay for order flow from Robinhood is that they don't believe retail orders will move the market because retail investors don't have any useful information about the stock. On the other hand, market makers don't want to trade against, say, Elon Musk buying or selling Tesla because they assume that kind of person knows something and they try to make them pay through the nose for liquidity. That is why people like that might announce well ahead of time the schedule that they plan to sell stock to diversify or raise funds and why there is a special sector of the industry to help move large blocks of stock, convincing buyers that they are not being exploited.
isleyaardvark 4y ago
I assumed it would be about mobile games.
maxbond 4y ago
> predictit (rip) Did something happen to PredictIt? They look up to me, and I still get marketing emails from them. Not finding any news storied about their demise.
- pessimizer 4y ago
  https://www.predictit.org/platform-announcements https://www.predictit.org/platform-announcements
- throwaway743 4y ago
  They're supposed to be shutting down on Feb 15th iirc. But after reading your comment I did a quick search and apparently they're suing the CFTC to remain open(?). So maybe there's a chance, but as of now it unfortunately looks like they're not gonna be running much longer :(
time_to_smile 4y ago
As someone perpetually intrigued by quantitative finance from a mathematical perspective, I started lurking on the /r/options sub on reddit. It was shocking the lack of basic knowledge people there have about the fundamentals of options pricing, their behavior and most importantly the risk involved. In itself this is not a big deal but through seeing conversations it was clear that many of these people are approved for very high level options trading and have margin accounts. Options are fun to study because they are the real world application of a range of probabilistic tools, and properly managing risk involves lots of cool stats. But precisely because of this trading them really should be left to people that know what they're doing, otherwise they become an incredibly powerful foot gun. But here's the thing. Options are a zero sum game, and currently 25% of options trading is retail. If I'm an institutional investor/trader this is great for me because it's like inviting a bunch of tourists to a poker table with professionals.

SQueeeeeL 4y ago

Most people are pretty behind the curve on the fact that stock trading is essentially elaborate betting on horse races, but sports betting doesn't have such skewed optics

filbo 4y ago
Horses competing or Humans competing, what's the difference?
adventured 4y ago
Trading is obviously different from investing. Horse racing has no such comparable as an S&P 500 index fund that will produce solid returns over a very long period of time (such that you can safely allocate N% of your income to it over a lifetime and can expect to do well).
- GrinningFool 4y ago
  I am certain you just inspired someone to start the first horse race index fund in which fund managers invest diversify by placing low- to moderate-risk bets at horse races around the world.
- matwood 4y ago
  You can buy fractional ownership in horses as an investment. Buying across a bunch of different horses would effectively be creating your own index.
sgjohnson 4y ago
> Most people are pretty behind the curve on the fact that stock trading is essentially elaborate betting on horse races If your drug of choice is deep-OTM weekly options, it suddenly becomes straight up gambling.
uoaei 4y ago
I think we should ban all stock transactions that aren't simply buying or selling shares for personal possession. Calls/puts, options, futures, etc. are just bets that are less complicated for corporate investment banks to automate strategies than for individual retail investors, leading to an obvious power and information imbalance that guarantees that the "house" always wins.
- sitzkrieg 4y ago
  futures have very legitimate use for producers and consumers of commodities. speculators then provide them liquidity but say, people blowing out accounts trading emini sp500 while having no idea what a futures contract is, sure why not
  - uoaei 4y ago
    Producers and consumers can provide their own damn liquidity. It's called "budgeting". This seems to be an explanation ex post facto and not a reason for its genesis. This insane liquidity generation scheme is one of many expressions of the force that drives unbridled exponential growth, which we can now see is in excess of what our environment writ large can sustainably provide. The pursuit of short term money-on-money returns is eating the world, and sycophants who personally benefit are turning blind eyes to this very basic and obvious fact.
- matwood 4y ago
  Derivatives have a purpose and closing off regular people is just more gate keeping.
fullshark 4y ago
That's only when the poor people do it, when VCs/ banks / hedge funds do it they are stewards of future innovation and macroeconomy efficiency experts, guiding our economy towards the activity that returns socially beneficial results.

PaulHoule 4y ago

It's a little different because: (1) Stocks do make money in the long term. If you buy and hold broad ETFs like SPY and QQQ you can do very well on Robin Hood. (2) The cumulative effect of people's speculation helps set prices and allocate capital. Even if many speculators loose, collectively the speculators have excellent judgement. It's as if the sports betting helped decide who wins the game.

scaredginger 4y ago
(1) Kinda irrelevant to the point, I feel, and Robinhood's design is (imo) clearly targeting the gambling crowd. (2) Slightly better argument, but retail orders don't have much effect on the market overall.
- PaulHoule 4y ago
  Some of the reason why market makers will pay for order flow from Robinhood is that they don't believe retail orders will move the market because retail investors don't have any useful information about the stock. On the other hand, market makers don't want to trade against, say, Elon Musk buying or selling Tesla because they assume that kind of person knows something and they try to make them pay through the nose for liquidity. That is why people like that might announce well ahead of time the schedule that they plan to sell stock to diversify or raise funds and why there is a special sector of the industry to help move large blocks of stock, convincing buyers that they are not being exploited.

isleyaardvark 4y ago

I assumed it would be about mobile games.

maxbond 4y ago

> predictit (rip) Did something happen to PredictIt? They look up to me, and I still get marketing emails from them. Not finding any news storied about their demise.

pessimizer 4y ago
https://www.predictit.org/platform-announcements https://www.predictit.org/platform-announcements
throwaway743 4y ago
They're supposed to be shutting down on Feb 15th iirc. But after reading your comment I did a quick search and apparently they're suing the CFTC to remain open(?). So maybe there's a chance, but as of now it unfortunately looks like they're not gonna be running much longer :(

time_to_smile 4y ago

As someone perpetually intrigued by quantitative finance from a mathematical perspective, I started lurking on the /r/options sub on reddit. It was shocking the lack of basic knowledge people there have about the fundamentals of options pricing, their behavior and most importantly the risk involved. In itself this is not a big deal but through seeing conversations it was clear that many of these people are approved for very high level options trading and have margin accounts. Options are fun to study because they are the real world application of a range of probabilistic tools, and properly managing risk involves lots of cool stats. But precisely because of this trading them really should be left to people that know what they're doing, otherwise they become an incredibly powerful foot gun. But here's the thing. Options are a zero sum game, and currently 25% of options trading is retail. If I'm an institutional investor/trader this is great for me because it's like inviting a bunch of tourists to a poker table with professionals.