Trading its Like Gamble??

[stueytrader]

when you enter a market you are a gambler. As soon as you close your position you become a trader. simple as that

That is a good way to define it, I agree.
What we 'gamble' upon is that we will be able to reach the position that we wish to close at.

[jimibt]

when you enter a market you are a gambler. As soon as you close your position you become a trader. simple as that

+1 -love it

[GoldenEggGoose]

Consider the house in a casino, would you consider the house is gambling against players? - No, because they have an edge, they are trading a know profit and loss position over time against the player.

A trader has an edge, they trade their profit and loss position over time against the market.

An edge could be knowing which way the market is going to move, it could also be reliable inside information from the stable, or it could be simply placing a back bet when you know the true odds of a horse winning are much less than the odds offered by the market. You may not win on an individual event, however over time you know that you will win enough to make a profit.

Trading is about taking positions that you know will be profitable over time.

[stueytrader]

Consider the house in a casino, would you consider the house is gambling against players? - No, because they have an edge, they are trading a know profit and loss position over time against the player.

A trader has an edge, they trade their profit and loss position over time against the market.

An edge could be knowing which way the market is going to move, it could also be reliable inside information from the stable, or it could be simply placing a back bet when you know the true odds of a horse winning are much less than the odds offered by the market. You may not win on an individual event, however over time you know that you will win enough to make a profit.

Trading is about taking positions that you know will be profitable over time.

Fair points, but couldn't the same be said for some gamblers too (position takers)?
Not sure this distinguishes traders specifically.
Plus, no info about a horse (even if correct) will mean it's price will certainly move in a specific way. Some horses run very well (and were predicted to do so by info) yet drift in the pre-race market, so that aspect of market moves remains the 'gamble'.

[gutuami]

when you enter a market you are a gambler. As soon as you close your position you become a trader. simple as that

That is a good way to define it, I agree.
What we 'gamble' upon is that we will be able to reach the position that we wish to close at.

sometimes I don't want to reach any position. Just doing a scratch trade to start bloody bf video
they really should change the way a trader access videos. for example by points earned within an hour.

[stueytrader]

when you enter a market you are a gambler. As soon as you close your position you become a trader. simple as that

That is a good way to define it, I agree.
What we 'gamble' upon is that we will be able to reach the position that we wish to close at.

sometimes I don't want to reach any position. Just doing a scratch trade to start bloody bf video
they really should change the way a trader access videos. for example by points earned within an hour.

Sure many empathise with that one, the BF LV trade is a specific subset!

[lmf21734]

Hi

For the person who insists that all forms of trading and speculating is gambling regardless of whether one has an edge, scientific probabilities in their favor because ultimately you are making a prediction on something that you have no control over then to be consistent would you agree that most things in life are gamble

1 You get married but have no idea as to whether the marriage will last
2 You apply for a promotion at work but have no idea whether you will get the promotion
3 You decide to drive to the supermarket but have no idea whether you will be involved in a car accident or not

According to your logic everything where there is no 100% certainity is gambling.

I beg to differ

1. You get married but have had a great friendship with the wife before and believe in communication and integrity and a willigness to see it through gives you a better probability of success than someone who doesnt believe in communication or intergrity or has a willingness to see it through

2. You apply for a promotion at work and have done your homework about the new position plus have invested in excelling in your existing position. You have studied interview techniques etc

3. In driving the car you abide by the speed limits, you are focused on driving instead of letting your mind wander.

Bottom line if you prepare the best you can then you cannot guarantee a positive outcome but you sure as hell put your self in a better probabalistic positive expectation outcome.

Clearly those that prepare are not gambling with their future and those in the opposite camp are gambling with their future.

So this brings me back to my point that those who study trading and finally understand the concept of probabilities and have the discipline to let their edge work out over a series of trades are not gambling.

I talk from experience. How can I be each week earning anything from £2500 - £4500 with a bank of £10,000 where I am committing to no more than 3% per trade with strategies and taking losses no greater than 6% day, with a profit to loss ration of 1:1 and with a strike rate per week averaging 70% averaging around 20 trades per week.

What is the difference between me this year as opposed to the previous 5 years where I was losing, blown up my account 4 times and where I couldnt accept losses and was guilty of some of the worst revenge trades possible and where I would places trades based on gut feel or the emotion of something happening in a game causing me to make a trade whhich has no justifiable positive expectanccy.

The difference is that in the former trading life I was gambling and in my positive present trading life I have built a foundation of trading based on statistics, probabilities, risk management and emotional discipline.

Now if you want to lump my 2 stages into the same boat and say its all gambling then thats your opinion.

But I know what gambling feels like and I know what trading feels like and boy is there a big difference in terms of results, and bank balance.

[stueytrader]

I hope the essence of what you say is true too. I don't want to 'gamble' (been there done that, lost many shirts).

I know that there is a qualitative difference between the different levels of gambling (some more some less). I also agree with the general idea that you get back what you put in (as the post above suggests).

[Crazyskier]

Hi

For the person who insists that all forms of trading and speculating is gambling regardless of whether one has an edge, scientific probabilities in their favor because ultimately you are making a prediction on something that you have no control over then to be consistent would you agree that most things in life are gamble

1 You get married but have no idea as to whether the marriage will last
2 You apply for a promotion at work but have no idea whether you will get the promotion
3 You decide to drive to the supermarket but have no idea whether you will be involved in a car accident or not

Semantics, lol.

I believe you are clouding the issue with risk management and expectation of gain. Essentially 'to gamble' is a verb as follows:

1.
play games of chance for money; to bet.
"he gambles on football"
synonyms: bet, wager, place a bet, lay a bet, stake money on something, back the horses, try one's luck on the horses...

2.
take risky action in the hope of a desired result.
"he was gambling on the success of his satellite TV channel"
synonyms: take a chance, take a risk, take a leap in the dark, leave things to chance, speculate, venture, buy a pig in a poke;

The fact remains that even with your declared 70% strike rate, there is still an element (30%) of risk and even if you get this to 100% as I do some days, the past performance is no guarantee of future potential.

It follows, then, that as soon as a bet is placed where the outcome has a degree of doubt, however small, whether by a successful pro trader or a losing punter on tilt, by definition we are all 'gambling' to lesser or greater degree. To suggest otherwise is to indulge in self-deception of the worst kind.

Sequences of trades that win more than they lose consistently over time, are still at their essence individual gambles at the point of being placed. And nobody has EVER found a 100% no-lose 'gambling' system, as that would no longer be termed as such, but rather as cheating.

[jimibt]

Hi
And nobody has EVER found a 100% no-lose 'gambling' system, as that would no longer be termed as such, but rather as cheating.

i'd like to be a cheat

[ShaunWhite]

Being a trader is much more like being a broker or a wholesaler.

Guy-X wants to [email protected], I think Guy-Y will want to [email protected].
If Guy-Y doesn't show up, I'll sell to Guy-Z @ 2.0 because he's always there.
I'm just the middleman.

I once asked a fund manager if what he was doing was gambling....he just said "well, MY horses don't fall over". He was a smug g!t, but he meant that he's able to minimise losses and maximise gains.

[jimibt]

I once asked a fund manager if what he was doing was gambling....he just said "well, MY horses don't fall over". He was a smug g!t, but he meant that he's able to minimise losses and maximise gains.

once again, this just proves that fund managers can't work in a contrarian manner. horses that fall over (as long as not hurt of course) are good!!

[ShaunWhite]

I once asked a fund manager if what he was doing was gambling....he just said "well, MY horses don't fall over". He was a smug g!t, but he meant that he's able to minimise losses and maximise gains.

once again, this just proves that fund managers can't work in a contrarian manner. horses that fall over (as long as not hurt of course) are good!!

Horses that fall over instantly become worthless in the current market. But as a trader, not a gambler, that can be exactly what we hoped for.

[Crazyskier]

Hi
And nobody has EVER found a 100% no-lose 'gambling' system, as that would no longer be termed as such, but rather as cheating.

i'd like to be a cheat

Haha! Me too.

And pay thousands in PC charges each month hehe.

[ShaunWhite]

Hi
And nobody has EVER found a 100% no-lose 'gambling' system, as that would no longer be termed as such, but rather as cheating.

i'd like to be a cheat

Can every single transaction be profitable? Probably not.
But 'No-lose' gambling systems have existed for years. The only guy in my small town who owns a Roller and goes on Carribean holidays operates a lay only system...he's the local independant bookie. He's red hot at pricing a race, judging public sentiment and won't take a penny at odds he doesn't like.

They're not all as good, after all look at what happened to John McCririck's bookmaking career Oh dear, how sad, never mind.

If you have the skill to find true value and settle for nothing less, you've got yourself a winning system, but I do think you need to be either an obsessive, a savant or a corporation to do it.