Is trading in the stock exchange a type of gambling?
By vids
@vhpsandi (358)
Mumbai, India
April 7, 2016 10:56am CST
I and my son have still not been able to come to one conclusion on this.
One of us ( won't say who) thinks that trading is a form a gambling, while the other argues its not. Its been lots of arguments and counter arguments, with no definite result. I would love to know your opinion and also support your opinion with a logical explanation please.
3 people like this
5 responses
@owlwings (43910)
• Cambridge, England
7 Apr 16
It depends on your reasons for trading. One reason for buying stocks and shares is because you wish to be a shareholder of (and therefore have some influence over and derive some return from) the companies you invest in. This is not gambling, though one may, indeed, suffer financial loss through unwise investment.
If your main purpose in buying stocks and shares is to sell them later at a profit, then that is gambling because one is, effectively, placing a bet (with oneself) on the likelihood of a certain article increasing in value over time.
1 person likes this
@owlwings (43910)
• Cambridge, England
7 Apr 16
@vhpsandi Any sensible person who bets on horses also studies form carefully before placing their bets. Of course, the big difference between betting on horses and buying stocks and shares is that the only person who really gains in the long run is the bookmaker and it is him one is betting with (and he who declares the odds). The horse, the trainer, the owner and the jockey are financially irrelevant to the bet.
1 person likes this
@vhpsandi (358)
• Mumbai, India
7 Apr 16
The other side of the argument is that although you invest to sell by profit, you not doing this by chance, They study the stock in which they are going to invest. Its rise and fall during the year, and a whole lot of other calculations and then only invest. So according to an investor the risk factor is only 30%.
So does this still categorize it as gambling or is it calculated gamble.
@TiarasOceanView (70022)
• United States
7 Apr 16
Of course it is gambling as one does not know the outcome of such investments.
Plain and simple is my logic.
@Mike197602 (15505)
• United Kingdom
7 Apr 16
It certainly is gambling but it can be less risky than things like horse racing or sports betting.
Obviously some trading is very very risky and some is less risky.
Buying shares in a utility company is still a bit of a gamble as prices can fall so it's entirely possible your capital may reduce...but it's way less of a gamble than putting it on a horse.
