Difference between trading and gambling

[trader_dante]

indeed, it mainly struck me last week when i was doing well at the casino and was still thinking up ways 2 the "beat" the wheel, when it dawned on me it cant be done!

One of the only ways I have heard of to beat the wheel is to look for a table slant but it's very hard to implement and requires a lot of time watching (much like the markets)

A good friend of mine is paid by casinos to watch for people doing it.

 

[Emini-mouse]

well in that case business is a gamble too you never know wht the outcome will be end of year, a recession might just po-up, and your bank stops lending you and you go bust. or some competitor might turn up and eat up all your margins and you re liquidated.

life is then a gamble too, you dont know the outcome of tomorrow

but in trading, chart patterns repeat themselves

but my life chart pattern tells me that the sun will probably rise tomorrow morning
everything including trading is either - certain - impossible - or a gamble

 

[N Rothschild]

One of the only ways I have heard of to beat the wheel is to look for a table slant but it's very hard to implement and requires a lot of time watching (much like the markets)

A good friend of mine is paid by casinos to watch for people doing it.

how would that effect it? unless one side of the wheel is hevier than normal it would have no baring on which side of the wheel would favour the down side!

 

[TheBramble]

it would have no baring on which side of the wheel would favour the down side!

{my emphasis}

Freudian or what?

 

[trader_dante]

how would that effect it? unless one side of the wheel is hevier than normal it would have no baring on which side of the wheel would favour the down side!

I've got no idea. That's what I was told.

 

[Shakone]

Horse racing is affected by past results for many reasons. We have something called a handicap, which means that a horse that has done particularly well in the past will be given extra weight to carry compared to a horse that has done poorly. Also, a horse than has done well, may be given a better jockey to ride it, which further increases its chances of doing better in the next race. And for the devious minded, it is not unheard of, for a horse to perform poorly so that its odds improve and then suddenly blow the field away with a win. Negative correlation if you will.

i dont believe it is self fulfilling, the sheer no of market participants and the infinate reasons for entering/exiting a trade make the odds of any level holding or not no better then 50/50.

I have 12 lines on my chart (more but only 12 around current action), and price moved through 7 of them, then the 8th held and it fell back to the 4th line which is currently holding. So out of 8, 7 failed and one held, and then on the way back 3 failed and one held. In my experience the chances of my levels holding are a lot less than 50/50 which you would probably agree with. Someone may say 'it is 50/50 and you're just plotting weak levels'. Fine, but then what does that tell you? It should tell you if you take to its conclusion, that different levels have different probabilities of holding. Bearing that in mind, why on earth would a level have a 50% chance of holding? Why would it have a less than 50% chance? Why isn't there a level that has a 70% chance of holding? They can't all be less than 50-50, because that doesn't make any sense.

While I'm on it, what makes you think that previous results of the roulette wheel don't affect the future ones? Are the initial conditions the exact same?

 

[N Rothschild]

because they dont lol, it cant really be debated! its solid fact they dont

 

[Shakone]

Solid fact. Love those

How solid is it?

I bet you one thing. Take a biased coin with 55% chance of landing heads. Toss it a bunch of times in front of others. Bet the majority will say that coin is 50/50. By the way, normal coins aren't actually 50/50, but that's getting beyond the topic I guess.

 

[N Rothschild]

how could previous results possibly effect where the ball will land? it cant..

just because the ball has landed 50 times in a row on black makes no difference to wether it will land black or red, its 50/50 regardless of previous results (well not quite 50/50 coz of 0)

 

[Shakone]

Are the initial conditions (wheel position and ball placement) exactly the same? If not, then the past result has affected the new. And is roulette even a completely random game?

It is ok if you think I'm nuts. Just asking where you divine these solid facts from? Extensive tests?

 

[N Rothschild]

dont really need to do extensive tests to know it has no effect.

i dont know if you play roulette much but most people bet on numbers/colours NOT coming up after a few hits in the same number/sector etc. So if the ball and wheel where spun identical to the previous times this again would have no effect on the odds of those numbers not coming up and you winning

 

[clorets]

At the end i think it all comes down to risk percentage.

But Trading also serves a more meaningful purpose than gambling. Trading is at the heart of the economy and is recognized as being essential, I don't think we can say that about gambling.

 

[N Rothschild]

why is trading essential? maybe in the traditional sense! i don't really thinking spread betting crude for 10 point or what ever people are doing is really the heart of the economy lol

if anything traders are a scourge on the economy!

 

[Vaco]

speculators ie traders are blamed for everthing wrong with the economy, from rising oil prices to the great deppression.

 

[Shakone]

dont really need to do extensive tests to know it has no effect.

i dont know if you play roulette much but most people bet on numbers/colours NOT coming up after a few hits in the same number/sector etc. So if the ball and wheel where spun identical to the previous times this again would have no effect on the odds of those numbers not coming up and you winning

Your approach is you don't need to do any tests whatsoever to learn if something is true. Aside from that being a **** poor approach to any effort in gaining knowledge, it is even worse when there is money at stake. Is your trading the same? Or do you look for things with evidence that they work? I guess/hope the latter. I'm not talking about backtesting here, I'm talking about you actually taking some results. You should just admit, you have never tested a roulette wheel, and even more than that, you don't know whether the past result affects the future result, because it is beyond your capability. If you did that, fine. You take it for granted, but why? Lots of people take many things for granted. Some people take for granted that the markets are completely random, a random walk, and you can't possible make money from them. Do you accept that? That is common knowledge, just like roulette wheels being random, or coin tosses for that matter. I don't accept any of that until I see proof.

If the initial conditions are not the exact same, then the result can be affected. If I toss a coin with a different power, or from a different side up, the result may be different.

These are gambling games that are designed to approximate something random that is hard to predict. They are not more than that. Stop thinking they are the perfect random games. They are designed by people, often many years ago to appear random and beyond prediction. They are not truly random, as evidenced by the fact that research on coin tosses show they might not be 50/50 and tossing a coin with machine precision from the same initial conditions can get you a head every time. Also as evidenced by people going into casino with the right equipment and predicting which third the roulette wheel will fall into. That's an edge. They've made money. You have some assumptions. I asked you why you hold them, and you answer is that you don't need to verify them to know.

 

[N Rothschild]

using equipment to measure which third it will land in has nothing to do with past results effecting the spin.

your going off on some total rant about testing? why? explain in ONE way the previous results on the wheel could EFFECT the next spin? they cant, you don't need tests to decide that..an iq or 105 SHOULD be able to comprehend it.

if you can give one valid reason why, black black black black black should give any indiction of the next colour, i will go and test it..ok?

 

[Shakone]

Roth, first accept it is not random. It is a result of initial conditions, that being the position of the wheel, the spin of the wheel and when and how the ball is put in. Then as I asked you, given a spin of the wheel and a result. On the next spin, are the initial conditions exactly the same. If it starts spinning from a different configuration then it is different. If the ball is put in at a different time, then it is different. If it is not at the same initial conditions, then the result has been affected by the previous spin. It might not affected be in a way that you would like or could predict, but it has been affected. It is not the same condition as the one before.

Also, I don't mind you carrying that belief, you could be correct. But I'm simply asking why you believe it. It seems the only reason you believe it is because someone once told you so.

Also given a bunch of blacks, I would be more inclined to bet on black.

 

[N Rothschild]

no one told me, i had been playing roulette for a few months thinking of ways to "beat" the wheel when it dawned on me it cant be done. (for these reasons)

why would you be inclined to bet black? your just being fooled into thinking its previous results effect it, and now you belong to the casino! its 18/37 NO MATTER WHAT even if it has landed black a million times

 

[TheBramble]

Also given a bunch of blacks, I would be more inclined to bet on black.

Too true bro'.

I'd be on me toes for sure...

 

[Shakone]

No I'm inclined to think that if anything the wheel is slanted towards black. That doesn't mean I would expect to win at a casino. But consider the following:

You have a game, and you have no idea what the probabilities are, because you haven't tested them. And every time you play, it comes up black. Or it comes up black 9 times out of 10. Now forgetting what you've been told about roulette or anything else...what would you gamble on if you had to?