The ethics of speculating

[Dispassionate]

Is there any point pondering over the moral ethics of speculating?
You could argue a principle and stick with it or apply moral reasoning on a case by case method. For e.g. shorting. Can anyone come up with examples?

 

[abobtrader]

I think there is a point in pondering. If you believe what you are doing is morally reprehesible, it may influence the quality of your trading, as well as the quality of your sleep.

 

[ajaskey]

Is there any point pondering over the moral ethics of speculating?
You could argue a principle and stick with it or apply moral reasoning on a case by case method. For e.g. shorting. Can anyone come up with examples?

I've thought of this before - taking Grandma's retirement money. Is it wrong to sell Grandma your shares of XYZ that are about to fall off the cliff? Other industries would consider that fraud. Is it wrong to buy Grandma's shares of XYZ when you know it will double next year? That could be considered just as dishonest as someone finding a Picasso at a garage sale and paying $5 for it.

I've decided that it isn't really worth considering as many things in life are zero sum. Similar real life examples: You take a job, some else doesn't get it - should you decline the job? You buy cheap stuff at a store and the store lays off people - would you pay more on a regular basis? Many more examples show up in everyday life.

Another point is that if you don't take Grandma's money, someone else will. It isn't like porn where if everyone declined to buy then porn would go away. The entire world economic system is based on taking Grandma's money. The alternative is to withdraw from society and live in a cave.

For those who still feel bad, they can donate some profits back to a quality charity organization.

 

[tommog]

Unless you have inside knowledge or an unfair advantage is perfectly ethical. Assuming speculating is a zero sum game (so for every winner there is a loser) it is perfectly ethical

If you play tennis with a friend and you beat him are you being unethical?

On another note you could say traders are keeping price fair by speculating in it. A company that fiddles its books is trading at a yearly high, is it ethical that this company and its shareholders are being financially rewarded by lying about their profits? Of course not, so traders short the stock and bring it down to a fair value that represents what the company is worth. Just as a company that works hard and is successful gets rewarded by speculators buying in to it.

Competition is what causes an increase in standards, all companies try to provide the best service they can to win our faith (in terms of financial investment), they get financially rewarded, we get better services, hence why communism doesnt work, because rewards are capped so why bother working harder. If the services are substandard and not worthy of what they are being paid we bring its value down.

This is very ethical in my view.

But on another note, dont worry about it, if you contemplaint the moral consequences of every action you take you would go insane, is breathing moral? After all you are taking o2 from the people around you and producing co2 which they cant use. why not rob them while youre at it! ;-)