Well it depends on whether or not you're asking my personal opinion, or the dictionary-definition argument I was referencing in my post. My personal opinion (which was made clear early on meant nothing), is that anytime you're getting paid more than the risk you're taking, its not gambling... and anytime you're getting paid less than the risk you're taking, its gambling. So in my die example, it would be gambling if I was getting paid even money every time a 1 was rolled, because the odds of winning are 5 to 1 against me. So as long as I was getting paid more than $5 everytime I won, and only had to pay $1 everytime I lost, I would have +EV and I would not consider it gambling. As long as you're getting paid enough in odds to justify the risk you're taking, then I personally don't consider it gambling.... if you're a 2 to 1 underdog and you're getting paid 4 to 1 on your money -- not gambling. Being a 4 to 1 underdog but being paid 10 to 1 on your money -- not gambling. Being a 5 to 1 favorite and not only not having to lay odds, but actually getting paid even money (as in the die example) -- not gambling... Being a slight favorite and actually getting odds on your money (which happens quite frequently in trading) -- certainly not gambling. So basically you could say that anytime you have +EV over the long run I personally don't consider it gambling... and anytime you have -EV I personally do consider it gambling. But once these guys started fabricating their own expanded definitions of gambling that basically included any business transaction that wasn't 100% guaranteed in advance to always be successful 100% of the time, and continued to maintain that buying real estate, running a casino, and running an insurance company were all forms of gambling... I grabbed a few of my trusty-dusty dictionaries to try to cipher through all the bull. The definitions common to most of the dictionaries was basically definition #1 & #2 from dictionary.com for gambling... and definition #1 from dictionary.com for chance -- the operative part being "the absence of any cause of events that can be predicted, understood, or controlled." My interpretation of it was that if there is any presence of any cause of events that can be predicted, understood, or controlled (i.e. excess demand causing prices to rise or excess supply causing prices to fall), then it can't be "chance."
I agree...hell if someone gave me pitt -100.. it be so close to a sure thing i'd be silly not to tak eit. casinos and insurance companies always know in advance that the odds are stacked in their favor..they know this in advance, there will always be the black swan possibility, but in advance they know that their edge will always be x % ( some games have better odds for the house) and x % it will be. When card counters tilted the odds more to the player than the house , the house changed the rules ( bigger shoe ) Trading doesn't always offer this beacuse it is a moving target... It's been a great topic of discussion though.
Okay. Thanks for answering the question. So, you are apparently opposed to any form of gambling. This is why you refuse to admit you are taking a gamble when you trade. Is this not correct? I'm am trying to get to the bottom of why a person like yourself, who obviously has a good mind, is flat braindead in being able to admit that when you take a position in something with an uncertain outcome, it is gambling. Are you against gambling for religious reasons? If you are, that's your business.
A primary objective of federal regulation of commodity futures trading in the United States is the elimination of market manipulation............................. But we all know that it goes on all the time. One of the reasons why some people assume trading to be gambling is because they fail to understand that the old adage - prices oscillate, though trends persist is still there. How many understand that and manage to build a strategy around that?
Yet again, you misunderstood my answer to your question. Its not a gamble because the outcome was uncertain, it was a gamble because in your scenario (1) I personally don't know enough about the intricacies of football and don't follow it well enough to have information that is going to give me an edge in picking one team over the other, and (2) I wasn't getting paid more than the risk I was taking, and therefore I had no +EV, and thus I had no statistical edge to take the bet. Not to mention your question was completely unrealistic because in sports betting, you can't just bet on the favorite to win the game (unless you're willing to lay odds and bet the money line)... the team thats favored has to win by a certain number of points. Now if you wanted to give me odds on one of the teams, such that if I won I would be getting paid many times more than if I lost, then I would be willing to do it, because regardless as to whether or not I won or lost that particular bet, I know that if I make similar bets over and over again I would be GUARANTEED to make money in the long run (this is not my opinion -- its statistical FACT). I know this a subtle nuance that you either don't understand or don't share, but I feel that its most consistent with the truth, than common biases, misconceptions, and misguided notions that are common amongst people who have never studied statistics, odds, and probabilities. The outcome of anything and everything is uncertain, and therefore, according to you, everything in life is a gamble -- which essentially renders any discussion moot since your arguments become circular. We know that its very rare for a plane to have mechanical problems and have to make an emergency landing, and yet, as we just found out, it sometimes happens. Does that mean that just getting on a plane is a gamble? According to you yes, because even though the chance of having to make an emergency crash landing is statistically very small, there is still a slight possibility that it might happen. However, I think most people would take issue with saying that every time you hop on a plane you're gambling with your life -- although according to your own definition of gambling, thats exactly what it is. And just for the record, I'm not opposed to gambling at all. I have known many people who have made quite a nice living gambling professionally -- both in the markets and at the casino. But the question of the thread was "is trading gambling" and the answer to that question is quite simply -- no. Although I've said many times that its not only possible to gamble in the markets, that its probably more common for people to gamble in the markets than not.
Although I do find it quite amusing, and rather fitting that when people talk about "being on the good side of a coin flip" that they're usually referring to having a 55% to 45% slight edge... which ironically, is almost the exact margin of "no" to "yes" votes in this thread's poll results.
Yes, because, just like in trading, the outcome is uncertain. If those 150 in the Hudson can't convince you, it's rather doubtful I can.
Jachyra is just debating the definition of the term 'gambling'. He doesn't consider +ev bets (whether casino or markets) to be gambling, he only considers -ev and uninformed bets to be gambling. Correct Jachyra?
What he's trying to do is make up his own definition of gambling so that he can fool himself into thinking that he's not. He wants to talk about all these books that "prove" he isn't gambling when he trades. Funny, but the book that counts and the one that he seems to have little regard for is the dictionary.
I've debated over the definition in this thread, and I'm pretty sure it was with Jachyra. The funny thing is somehow it switched from 'gambling' to 'chance', when I said 'chance' is always a factor. The fact is that any credible dictionary has at least one definiton as this: to place a wager on an uncertain outcome. Gambling in a casino or trading in the markets both fit this description (the two factors being 'stake' and 'uncertain outcome'), so I don't know why people still deny it. It's also pretty clear that many people don't read, as I've brought up the definition a number times only to see people ignore it and state something along the lines of "trading isn't gambling because I have an edge". The definition isn't really important though, just as long as it is understood that bets/trades need to be placed with a positive expectation.