FAQ Is Trading the Same as Gambling?

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Masquerade

Senior member
2,543 283
The house always has the edge in Blackjack. The house does not have the edge in poker or trading if you know what you're doing.

It is all still gambling by definition of the word "gambling".
If you're playing poker against a casino the house does have an edge.

If you're playing poker against people/trading against people then you're not betting against the house. They're just taking a cut of you so it's kind of irrelevant.
 

Masquerade

Senior member
2,543 283
getting back to the subject
blackjack is a more sure gamble than trading the markets
That's rubbish. You can't demonstrate the probability for taking a trade at price x and the % chance it will succeed. I on the other hand can demonstrate the probability you will win/lose/tie in blackjack. For many people they're better off playing blackjack.
 

DionysusToast

Legendary member
5,963 1,499
The house always has the edge in Blackjack. The house does not have the edge in poker or trading if you know what you're doing.

It is all still gambling by definition of the word "gambling".
Well - actually you should say... "The house always had the edge in Blackjack, if you don't count the cards, in which case you get thrown out of the casino."

I remember picking up my winnings at the Bookmakers in the High St, Alton Hants. I remember the bookies words as clear as if they were yesterday. "Well done, don't come back".

That's an edge you can't beat.
 

Emini-mouse

Active member
113 12
That's rubbish. You can't demonstrate the probability for taking a trade at price x and the % chance it will succeed. I on the other hand can demonstrate the probability you will win/lose/tie in blackjack. For many people they're better off playing blackjack.
With blackjack you can work out your exact edge using mathematics
With trading you rely on historic statistics
 

Masquerade

Senior member
2,543 283
With blackjack you can work out your exact edge using mathematics
With trading you rely on historic statistics
So what you're saying is that you have no idea of the probability that a market will move in a given direction at a specified time?

Tell me....using your historic statistics of 2000-2006 of eur/usd, how would that have served you in the period of 2007-current? Chances are you'd have lost most, if not all basing your trades on those statistics. If you want to rely on historic statistics go study the horse form guide or analyse sports and bet on it.
 

Splitlink

Legendary member
10,850 1,233
I say that I might think that I have an idea, but the reality can be quite different.

Blackjack aside, I have thought about horses, although, I do nothing except the lottery outside of trading.

I think that a risk/reward ratio of 1:1 or 2:1 has a much better chance of success when trading any 2:1 bet on a horse but, of course, 20:1 on a horse is more likely than any 20:1 on a trade.

Does that mean that 1:1 or 2:1 ratios are the best way to go when trading?
 

Masquerade

Senior member
2,543 283
sorry im confused if you are agreeing or disagreeing
If you rely on historic statistics they are only as valid till they're not. Hence in trading if you relied on historic statistics to base your decisions on you'd be gravely mistaken and would be better off applying it to something with less variables such as sports. You only have to look at what happened to the markets between 2007-current and can appreciate how some person who'd programmed the market stats from 2000-2006 would have got severely burnt.
 

Masquerade

Senior member
2,543 283
I think that a risk/reward ratio of 1:1 or 2:1 has a much better chance of success when trading any 2:1 bet on a horse but, of course, 20:1 on a horse is more likely than any 20:1 on a trade.

Does that mean that 1:1 or 2:1 ratios are the best way to go when trading?
Your risk/reward is not the odds of the event occurring.

A horse that is 20-1 has a 5% chance of winning the race (assuming the bookmaker is efficiently priced.) A trade where you risk 1 to make 20 does not have a 5% chance of success. How you conclude that 20:1 on a horse is more likely than 20:1 on a trade perplexes me.
 

SanMiguel

Experienced member
1,136 25
nope trading the market takes skill and most important true disicipilne.The failure rate is incredible high because it's a tough business.

There is a word for it it is called speculation where you use a strategy to take high propablity trades.Gambling is way more fun than sitting in front of your screen for hours carefully choosing your trades using indicators based on math.Consider a sucessfull trader that let's say for example sake has a winning rate of 80%.

That means all things being equal you can say that everytime he enter a trade he has a 80% chance of making money.I think your odds with gambling should be about 50/50.

There is no game of chance that even slighty resembles trading.So my opion it is not gambling it is speculation and we are speculators.

I know my english is terrible but it is my third language
Poker is gambling but i has a skill element.
Trading is gambling by the same factor.

Anything involving money on an uncertain outcome is gambling but you shouldn;t have an issue with that. The real question is more about society's perception of gambling vs what you do to make money.
 

Christiaan

Active member
227 10
tecnical analysis is a science and this science is older than either of us.There is risk but that is why it is called speculation.

How can you compare one's ability to bluff with carefully choosing trades trades employing this age old science which is far more complex than a mere card game.
 

SanMiguel

Experienced member
1,136 25
tecnical analysis is a science and this science is older than either of us.There is risk but that is why it is called speculation.

How can you compare one's ability to bluff with carefully choosing trades trades employing this age old science which is far more complex than a mere card game.
poker is not all about bluffing. In fact, bluffing is probbaly less than 10% of the game.
Some would say TA is a religion.
Anything with money on the line with an uncertain outcome is gambling.
Your misunderstanding of poker is the same way people misunderstand trading.
 

Christiaan

Active member
227 10
i must admit i know nothing of poker.Still it is only a card game.There is a risk in trading but then there is also risk in investing.

Then investing is also gambling?
 

SanMiguel

Experienced member
1,136 25
i must admit i know nothing of poker.Still it is only a card game.There is a risk in trading but then there is also risk in investing.

Then investing is also gambling?
some could say trading is only trading :)
Personally, I think investing is an old fashioned term used mainly in regards to buying houses or stocks where people were used to the phrase "the price always goes up". The price quite clearly does not always go up, you could for example buy a house and have the price go down so it is open to risk and therefore your money is still on the line.

IMO, gambling, trading, investing are all just societal words for the same thing of which some have been more accepted than others and some have more skill than others.
If you played chess for money, what would that be? Backgammon is a skill game too.
 

Splitlink

Legendary member
10,850 1,233
tecnical analysis is a science and this science is older than either of us.There is risk but that is why it is called speculation.

How can you compare one's ability to bluff with carefully choosing trades trades employing this age old science which is far more complex than a mere card game.

I do not think that TA is a science. It is more of an art ie. a skill.

What I am looking at, right now, is the formation of a price pattern. I do not know how it is going to end. I have placed stops in case my assumption is contrary to what will happen. There is nothing scientific about it because price patterns are only correct afterwards. As far as I am concerned, they are no good to me, then, and I act while they are forming. By getting into a short trade near the top I get a risk/reward factor that I like, in preference to waiting for a breakout.

Card games are the same. Who knows what the the other players are holding? That is the object of the game. A skilled poker player probably uses his reputation to instill fear into his opponents and to make them quit early ! :D I don't play card games so don't really know.
 
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