FAQ Is Trading the Same as Gambling?

[Windlesham1]

I think it would be very helpful if you would expand on your view and what this is based on and add some context. I.e
FX is rubbish because....,
Indices are less rubbish (but still rubbish) because...,
Directional trading is rubbish because...
The only sensible way to trade is X because....
(and maybe even) The only way to trade is X and this is how I do it...

The evidence speaks for itself unless you live under a rock- I think maybe 1% of Greg Seckers alumni have made a go of trading. There are other trainers.Every website warns that 80% of CFD traders are losers. ( They don't say what a winner is-presumably someone who still has their £6k. ) However-go to any of the money shows and ask around- the profitable guys are the ones who are clever in stock selection and understand that shares are for the long term. I trade FTSE options which have a lifespan, so I don't need my own time horizon. I've only met profitable options traders.
So in my experience, knowing many like myself who tried full time to trade forex, personal evidence paints a clear picture.
I cannot post my website here but out of 160 trades(one every week) I think there are about 5 small losers. Not because I'm good, but because options allow you to be wrong and still make money. I've been trading badly but profitably since the last century, and this is my experience. I wish everyone who tries to trade, my very best wishes and hope they can cut it. The odds, sadly are massively against them

 

[cantagril]

The evidence speaks for itself unless you live under a rock- I think maybe 1% of Greg Seckers alumni have made a go of trading. There are other trainers.Every website warns that 80% of CFD traders are losers. ( They don't say what a winner is-presumably someone who still has their £6k. ) However-go to any of the money shows and ask around- the profitable guys are the ones who are clever in stock selection and understand that shares are for the long term. I trade FTSE options which have a lifespan, so I don't need my own time horizon. I've only met profitable options traders.
So in my experience, knowing many like myself who tried full time to trade forex, personal evidence paints a clear picture.
I cannot post my website here but out of 160 trades(one every week) I think there are about 5 small losers. Not because I'm good, but because options allow you to be wrong and still make money. I've been trading badly but profitably since the last century, and this is my experience. I wish everyone who tries to trade, my very best wishes and hope they can cut it. The odds, sadly are massively against them

Well, yes, up to a point. It is unfortunate that a lot of people DO indeed live under a rock though this tends to be a psychological/epistemological one rather than a slimy boulder. IMHO, the problem starts with not knowing what you don't know (or should know) and then deteriorates into endless repeating more or less the same things without actually learning or improving much.

I was extremely lucky that my very first foray into trading happened just after Big Bang and the guy who gave me the intro was an options trader. ...and the rest, as they say, is history. Suffice it to say that had things been very slightly different I would probably be doing exactly what the 80% do rather than drifting back toward the loving arms of your pals Myron and Fischer.

That said, the shop where I traded (arcade/prop) included some really suicidal and noisy futures traders who seemed to spend a lot of the day in the toilet snorting Beecham's powders - or so it looked - and some much quieter guys who cleaned up using all sorts of different strategies ......but options were definitely in the minority.

 

[cantagril]

........
.....options allow you to be wrong and still make money. I've been trading badly but profitably since the last century, and this is my experience. I wish everyone who tries to trade, my very best wishes and hope they can cut it. The odds, sadly are massively against them

I hope you'll forgive the edit but I think that this is the quintessence of the options advantage or "edge" (if you prefer) and I hope than anyone reading will be inspired to at least check them out.

 

[Windlesham1]

I hope you'll forgive the edit but I think that this is the quintessence of the options advantage or "edge" (if you prefer) and I hope than anyone reading will be inspired to at least check them out.

95% of pewople are like kids in the sweet shop they have no patience and think trading isa short cut to riches. Trading should be boring, methodical and consistent.

 

[Richard Salime]

It is very good to read each of the comments, really here you learn a lot

 

[progix]

Forex trading is not roulette actually if we learn more about it. It is a very professional market which does not spare any of the mistakes so anyone who wishes to make money from forex trading should start learning about this industry and how the processes works.

 

[tomorton]

Gambling has fixed odds, whereas in trading the odds vary according to your level of knowledge and skill.

Imagine someone placing trades throwing a coin up in the air and using heads or tails to decided if going long or short. He will have 50% chance of success. This is like someone trading in the markets with no knowledge and skill, in fact I would say that someone trying his luck on the markets could even have a worse performance if not basing his trades on heads or tails.

Now, imagine if it was possible for someone to master a technique where he can make the coin land on tails 75 - 80% of the time? He would always place his bet on tails. This is like someone mastering a skill and setup to trade the markets.

That's a good analogy.

Trading is not like gambling at roulette but it is like gambling at cards. If anyone thinks gambling at roulette is the same as gambling at cards, my advice is get them into a poker game and take their money.

 

[James turtle]

I agree with most here too. Trading isn't anything like gambling and if you think its gambling, its high time to get your facts right. It requires as much hard work and skill as any other profession or money making thing in the world.

 

[tradingout]

This was an interesting read so far. Of course trading and gambling are so much different in such a way in term of skills, knowledge, and more.

 

[marcela 2020]

you are not wrong, it is not the same.

 

[Henow1969]

In the game you do not have the option of stop loss and in trade, you have to incur losses and you can easily stop your losses when this option is not available in the game and in trades you need to learn proper and Focusing on hard work and the game only plays on your ability to open your destiny, and I think that's a big difference between betting and trading.

 

[postman]

It's a long thread so someone may have mentioned t before, but trading is like poker, it involves some luck in terms of the outcome but you can use odds to determine your chances of winning or not and then play those odds or fold. And if your rich enough you can even bully the market but that's not us that's the hedgies and merchs.

 

[xjtorerox]

No, is not the same.

As many users said, gambling is luck. Trading requires you to gain knowledge and recognize patterns, also requires you to read in order to be informed about the financial market.

 

[postman]

True. Gambling is just luck.Trading needs knowledge and skills.

Maybe by your definition "Gambling is just luck." but the rest of the world see's it differently.
Here is the dictionary definition of luck!
"Take risky action in the hope of a desired result. "
"Gambling is the wagering of money or something of value on an event with an uncertain outcome, with the primary intent of winning money or material goods. Gambling thus requires three elements to be present: consideration, risk, and a prize."

Trading has an uncertain outcome, we are all familiar with the phrase "The market can remain irrational longer than you can stay solvent", well that's the uncertain outcome part.

We may know that this market is going to crash again when business keep failing, people lose their jobs and default on their rent / mortgage / loan payments and yet it still keeps going up! Will printers go Brrr again? Who knows - uncertainty.

 

[galbi]

I wouldn't say so. They are both very different in their field but can be easily mistaken as the same for the common people.

 

[postman]

This has been a very popular question and I guess that it is time that we shed some truth on the matter. Trading is the same as gamblig. Why is this you may ask? It is just like gambling because it also involves stakes and high risks. If you trade on the mobile platform then trading has been simplified for you. All that you have to do is predict the direction that a graph will go. If you are right then you gain profit, if you are wrong then you lose all the money you put inot it. If that is not llike gambling then I do not know what is. The only thing that makes it interesting is that you get to see the results in less than 2 minutes.

If your definition of gambling is " It is just like gambling because it also involves stakes and high risks." then you're trading wrong. Your trading should NOT involve high risk!
"you get to see the results in less than 2 minutes" Jeeze what are you trading? Have you heard of stocks? Bonds? ETF's?

 

[barjon]

I wouldn't say so. They are both very different in their field but can be easily mistaken as the same for the common people.

What an absolutely pretentious statement. I think the “common people” probably have it right however comfortable and superior it makes anyone feel to describe their gambling in words that enhance their status like speculating or investing.
Doesn’t matter what you call it, trading is risking money with objective of gaining a monetary reward when that reward is uncertain. That’s gambling but, if that’s too “common” for you make up something posh to make you feel superior to the common herd.

 

[omer]

Gambling is completly diffrent than trading . let me give an example , poker is a game of gambling
but there are certain proffesionals that use certain strategys to make them be more succesful then others.Im watching poker for years and can tell you that most of the time the same players reach very high places in competetions ,
for example ( phil ivey , daniel negreanu ,exc). It shows you that these players are using certain strategys and not only intuations to be succesful in there field. Exactly the same thing in trading , there are traders i personally know that are trading and making the same money for years , This shows you that it really depends how you look at it, people see it as gambling and people see it as trading but the people that see it as trading are more succesful because of there approach.

 

[postman]

Gambling is completly diffrent than trading . let me give an example , poker is a game of gambling
but there are certain proffesionals that use certain strategys to make them be more succesful then others.Im watching poker for years and can tell you that most of the time the same players reach very high places in competetions ,
for example ( phil ivey , daniel negreanu ,exc). It shows you that these players are using certain strategys and not only intuations to be succesful in there field. Exactly the same thing in trading , there are traders i personally know that are trading and making the same money for years , This shows you that it really depends how you look at it, people see it as gambling and people see it as trading but the people that see it as trading are more succesful because of there approach.

Poker is relying on the other person to make a mistake before you do! If no one makes a mistake its pure luck!
There is poker software out there that can calculate odds and beat any human player, because it never makes a mistake.

THE WORST BAD BEAT IN POKER HISTORY: 99.84% FAVORITE LOSES
BRYCE YOCKEY FALLS TO JOSH ARIEH IN HISTORICALLY UNLUCKY HAND

The Worst Bad Beat in Poker History: 99.84% Favorite Loses | PGT

<p>The final table of the 2019 World Series of Poker $50,000 Poker Players Championship produced quite possibly the worst bad beat in poker history as <a href="https://twitter.com/SuddenlyBryce/status/1144761923809902593">Bryce Yockey</a> saw a 99.843% hand turn into dust when <a...

www.pokercentral.com

 

[omer]

Poker is relying on the other person to make a mistake before you do! If no one makes a mistake its pure luck!
There is poker software out there that can calculate odds and beat any human player, because it never makes a mistake.

THE WORST BAD BEAT IN POKER HISTORY: 99.84% FAVORITE LOSES
BRYCE YOCKEY FALLS TO JOSH ARIEH IN HISTORICALLY UNLUCKY HAND

The Worst Bad Beat in Poker History: 99.84% Favorite Loses | PGT

<p>The final table of the 2019 World Series of Poker $50,000 Poker Players Championship produced quite possibly the worst bad beat in poker history as <a href="https://twitter.com/SuddenlyBryce/status/1144761923809902593">Bryce Yockey</a> saw a 99.843% hand turn into dust when <a...

www.pokercentral.com

You are right, there is a software that can beat any trader just like there is software that can beat any poker player thats why when im trading im using 80% software and 20% human intuation , knowledge , and skill. At the reall market you can actully bluf when major coperations like banks are buying or shorting in the markets you can see if its an actual change of a trend in the market or just a short term correction but that requires skill and knowledge in the financial market , witch very few people have.