isnt the market itself exactly that?
this post was submitted on 28 Oct 2024
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Long term market rate of return is positive (extremely positive of late), where as casino gambling is EV negative.
But options and futures exist as a short term hedge on equity investment. Combine that with the vig Robinhood takes on the front end in the form of higher contract prices, and you end up with an EV negative return - more consistent with high stakes gambling than equity investing.
I class market trackers as investing rather than gambling.
Sure they can still go down (and by a lot), but it tends to be big events like COVID that do that, and it soon bounced back up again.
If you're investing more than a few percent of your portfolio in any one company, you're probably gambling though. And sure, nVidia look a safe bet today, but if Sam Altman comes out tomorrow and goes "sorry guys, this ain't going anywhere" then you'll lose over half your money before you can blink.
I wouldn't invest on a timeframe of less than a few years either. It's not for boosting your rent money. It's just better than leaving your spare money in cash. If the concept of "spare money" is alien, then it's probably not for you.
If you're investing more than a few percent of your portfolio in any one company, you're probably gambling though.
I read a forum post many years ago about people that put all their retirement money into some company that was going to be the sole supplier for some components for the iPhone. Apple didn't end up going with them, and the company was relying entirely on that contract. The company went bankrupt, and the people that invested lost all their money.
In the end, why invest in a small number of companies when you can invest in practically all of them? Bogleheads three fund portfolio (total US stock + total world stock + bonds) is very simple yet will beat most actively-managed portfolios over the long run.
Let's be honest, most share trading is more like gambling than it is like investing.
I work for a publicly traded company and I have some visibility into what’s happening with our products and business. Then I read the Y! Finance page about our stock and it’s all weird math trends analyses and absolutely zero about our company, its fundamentals, and the future of our business. Stock trading is just a bunch of assholes trying to sift the sea of numbers to divine a magic formula. The irony is that their own behavior drives the price changes, so they are feeding straight into the data they are trying to read and act on. What a circle jerk.
The market is wild sometimes. I work for a fairly large company. Sometimes in our earnings reports, we exceed EPS and revenue expectations (which is good of course), but don't exceed them as much as some analysts think we'll exceed them, so the stock goes down. The expectation is that we'll always exceed the expectations lol
Yes, and good news about the company can drive the stock price down, if enough people decide that that’s probably a high point for the near future and a good time to sell and take profits.
Let's be honest, our "free market" is a regular casino for the plebs that own about 10% of shares in their 401ks and Robinhood accounts, and an intentionally rigged casino for the oligarchs that own the rest, with marked insider information cards, and loaded market manipulation dice.
Gotta love when the bootlickers defend this economy, and market investment, as somehow inclusive, when 93% of stocks are owned by 10% of Americans.
(Saved Fortune article) https://archive.ph/DW0A8
It would suck if working class Americans lost their retirement money due to Wall Street getting what they deserve. But what sucks more is that our retirement system is based on letting rich people gamble with your money in the first place!
I guess it depends on your main goal. I started out as a gambler then lost a bunch of money and started actually investing. But at the end of the day every transaction you make can be called a gamble.
Semantics.
I just want to tip my hat to Elizabeth Lopatto's writing in this piece. I miss following her on twitter and had forgotten how spicy and on-target she can be. Good stuff.
They're almost there…
All these copium defend the market takes, you telling me Tesla, a failed venture living off government subsidies, is worth 16x more than the hundred year old Ford that actually makes a profit without fraud?
a failed venture
Bruh wut.
living off government subsidies
Are you referring to the consumer incentives to buy electric? Not only are these ending, but they’re some of the least hinky government subsidies of business in the economy, because they go direct to the consumer. Have you seen what our government does for corn farmers and big oil? Oh right, corn and oil: those other “failed ventures” LOL
Tesla, a failed venture living off government subsidies
It's not a failed venture precisely because it lives off government money. Show me a Fortune 500 company and I'll show you a large stream of public sector receipts.
Tesla stock prices in the expectation that they'll have robotaxi services and general purpose robots in the near future. And also that they will be leaders in these fields, ahead of the competition.
How likely/unlikely that is to happen is debatable, but that's why some people are valuing the company so high right now.
Hi-tech tulips.
It's also why he's hanging it all on Trump right now.
That's what he's after - the complete deregulation of self-driving safety standards in the US.
"Debatable" is a heavy stretch for someone with a 0% track record when it comes to promised tech while repeating "we can do it NOW and it will be available NEXT YEAR!" for a literal decade. Robo taxies were supposed to be EVERYWHERE 4 years ago. Same with SpaceX, we were supposed to be sending the first people to mars this year, yet all Elon has managed was burn 3 bilion tax payer dollars for literal fireworks, as not a single "starship" managed to reach high orbit. Even the cybertruck is a cheap knockoff of what was promised. Not to mention the countless people that have died because he's allowed to beta test his death machines in public. Can't forget his starlink shenanigans in Ukraine, fucking warlord wannabe... Elon is the greatest scam artist in modern history, and it's absolutely disgraceful that he isn't behind bars, let alone valued at all.
What? The stock took a huge hit after that reveal. It's a cult of personality.
Yeah, because the market went from having the opinion of "I'm 80% sure that Tesla is going to do this robo taxi, automaton thing" to " I'm 65% sure that Tesla is going to do this robotaxi, automaton thing". Things are rarely all or nothing with the market.
I'm 80% sure he's going to do it, and 100% sure it'll be a disaster if he does.
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Bruh, wtf you think stock trading is? Buying into funds is just hiring professional gamblers to work for you, "insider trading* is cheating and dark pools is just the high rollers table.
In gambling, the house always wins, by extracting value from the players. In stock trading, the players (capitalists) collectively always win, by extracting value from labor, technological growth, and natural resources. These are not the same picture.
Sure, you can take on as much risk as you like using derivatives, and emulate a gambler using the stock market as a source of randomness (volatility). But that's not how most traders behave, and it's not how most traders' payoffs work.
90% of users lost money while trading
the end result is very much the same
Damn, I’m up over 100% since I downloaded it seven years ago. Thank you, ETFs and tech companies I dig!
Same, looks like I'm not part of that 90% either, only 4 years account age here.
Heady!
Nice story, bro.
I'm also up, more years, not Robinhood.
Then you glance over to Wallstreet Bets, they are the direct opposite on the curve.
Yet still almost everyone loses money on exchanges, for various reasons which I don't want to spend time writing up.
But market has been irrational for many years, with no signals of slowing down.
I mean, I feel most people who lost money were doing "options trading", basically full on gambling/speculation. If you had put that money in an s&p500 index fund, chances of losing money are slim.
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Great. Now how about Citadel's $65 Billion in securities sold but not purchased? Just kickin that can, eh?
Hard to see how the SEC and DTCC aren't complicit.
Citadel commands something like 8-10% of daily market volume. They're the textbook Too Big To Fail investor. SEC won't touch them for that reason alone, although there are plenty of other ideological/conflict of interest reasons, too.
I don't disagree, but it's the whole REASON the SEC was created in 1934.
If anyone needed further proof of end-stage capitalism, it's this goddamn insistence on regressive everything.
Anything deemed "Too Big To Fail" is also a national security risk. Nationalize the whole firm, send the executives off with whatever loot they already have, and ironclad legalese to prevent them from ever setting foot in a financial market again.
Weren't they one of those blocking early GME?
They turned off the buy button when it was about to squeeze.
Even before that they have been accused of not buying stocks ordered by users, then buying at sell order and waiting for the price to raise to sell so they get a profit. It's been questioned a long time.
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