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Saturday, April 18, 2009

Stock Market is Gambling. WRONG mind - set.

Some people say that Investing in the Stock Market is like gambling.

My Answer:

It depends on how you approach the Stock Market. If you approach it as a gambler, then it will be gambling. If you approach it like an investor then you are investing not gambling. The fact that the number 2 Richiest Man on earth "Mr. Warren Buffett" is still investing in the Stock Market to accumulate wealth. This is one of the many proofs that Stock Market Investing is a real investing not gambling. Another proof that investing in today stock market is not gambling is the following equation taken from the idea of Dr. Harp which he called "Positive Expectancy":

In gambling, when you do your bet, the situation is always zero (0) expectancy.

50% win x $1.00 bet + 50% loss x (-$1.00 bet) = 0

In Stock market Investing, when you do your bet (will just call it a bet for comparison), the situation is always not zero (0) expectancy.

60% win x $1.00 bet + 40% loss x (-$1.00 bet) = 0.20, or

this situation:

50% win x $1.00 bet + 50% loss x (-$0.90 bet) = 0.05

Ther are so many proof pointing to the fact that today stock market (click for more insights) is not Gambling. For now I will just give you two (2). Keep your browser on this blog for mor investment information or click this.

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