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Are You Trading or Gambling?

investinglessons.substack.com

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Re: Are You Trading or Gambling?

#201

Post by chasebank »

hef19898 wrote: post #33
elygre wrote: post #13

Around 20 years ago, I had the opportunity to listen to a member of Nasdaq top management talk about the stock market. It's all a _tiny_ bit blurry, being a long time ago, but I remember how he talked about three different perspectives for investing in stock: First, the "company perspective". An investor would buy stock in a company they believed in. Maybe they had good products, or good management, or something else…

The reason I will never touch day trading is, that it is basically the same thing HF traders do. Only 1000 times slower. So I will loose against these guys every single time. And even HF traders loose money. The only single stock investments I have came from employment, either through RSUs or employer sponsored stock buying programs. RSUs are just coming to you, and why would I not take stock at 50% discount? The onl…

I'm only correcting you because I'd want to be corrected.

Loose = Not firmly fixed into place.

Lose = Cease to retain.

Lose is the verb you want to use here.

Re: Are You Trading or Gambling?

#202

Post by anm89 »

People are gambling when the buy assets you don't like and investing when they buy assets you do like.

Pretty cool because it is literally impossible to lose money investing because if you did lose money it turns out you were gambling.

Re: Are You Trading or Gambling?

#203

Post by hckrnrd »

ves wrote: post #161
NOTaCODERR wrote: post #61

Earlier quoted context omitted.

It’s really interesting seeing how HN can be so uninformed when the topic changes to their area of expertise, this thread is insightful and I’ll use the search button to get an understanding of how many morons are on this forum, this is great for me as I’m not a coder and thought this crowd was ‘smart’.

HN is not a smart crowd, but there are smart people on it.

Can you define “smart crowd”? It seems like all large gatherings are by definition “dumb” due to group dynamics that add friction to challenge existing norms. The “smartest crowd” may be the America due to the freedoms to create as many crowds—within reason—as one wants. A crowd of crowds as it were.

Re: Are You Trading or Gambling?

#204

Post by kortilla »

olalonde wrote: post #197
randomsearch wrote: post #163

Earlier quoted context omitted.

I’m undecided on Bitcoin. Happy to be called ignorant, but only if you can explain why. There are many ways of transferring money across the internet. Why is Bitcoin special if that’s the reason for its value? Genuinely want to be won over.

> There are many ways of transferring money across the internet. Only through a centralized intermediary (e.g. PayPal), which may block the transfer, freeze funds, deny access, go bankrupt, etc. Bitcoin allows direct peer-to-peer money transfers (a bit like cash but digital). > Why is Bitcoin special if that’s the reason for its value? Personally, I feel that the censorship resistant and pseudonymous p2p money transf…

> Its rules are pretty much set in stone.

Not quite. The miners collectively decide what rules to follow. A majority of them forming a cartel to collectively skip certifying certain transactions is completely in the realm of what’s allowed by the network.

Re: Are You Trading or Gambling?

#205

Post by VectorLock »

hourislate wrote: post #186
elygre wrote: post #13

Around 20 years ago, I had the opportunity to listen to a member of Nasdaq top management talk about the stock market. It's all a _tiny_ bit blurry, being a long time ago, but I remember how he talked about three different perspectives for investing in stock: First, the "company perspective". An investor would buy stock in a company they believed in. Maybe they had good products, or good management, or something else…

I believe "Market Wizards - Jack D. Schwager" highlights this. When speaking with some of the best and most successful traders in the markets, he found that the one common thing between them was "Game Perspective". They understood human emotion and had this desire to be the best at the game. The money/wealth was not the focus but the reward. If I remember correctly (read the book a couple of decades ago), most did no…

Being amoral loses its advantage when every other player is similarly feckless.

Re: Are You Trading or Gambling?

#206

Post by hckrnrd »

dalbasal wrote: post #30
elygre wrote: post #13

Around 20 years ago, I had the opportunity to listen to a member of Nasdaq top management talk about the stock market. It's all a _tiny_ bit blurry, being a long time ago, but I remember how he talked about three different perspectives for investing in stock: First, the "company perspective". An investor would buy stock in a company they believed in. Maybe they had good products, or good management, or something else…

Well put. I am picturing as a triangle of three perspectives. That also gives you three (or 6) possible cross-perspective stories. The dynamics between these perspectives are where things start to get squirrely. 2021 memestocks like gme are good examples. Game perspective (no. 3) was the main story. Short squeezes. Retail investors getting cut off, etc. The stock perspective (no. 2) is now all about game investors. C…

Through technology—global connectivity, mobile accessibility, and apps like Robinhood and their global counterparts—there’s no reason to expect the demand to wane.

https://amp.scmp.com/business/article/3119779/futu-restore-t...

Re: Are You Trading or Gambling?

#207

Post by WrtCdEvrydy »

vermilingua wrote: post #150
BelenusMordred wrote: post #144

Earlier quoted context omitted.

You forgot no share dilution in this offtopic tangent. Every stock out there can double their issuance if they want to.

As can bitcoin, and it would only take a soft fork.

Yeah, but you have to have people switch to that chain.

Miners won't because it would devalue their coin.

New buyers might because they can "buy cheap"

Re: Are You Trading or Gambling?

#208

Post by WrtCdEvrydy »

thebigspacefuck wrote: post #192
randomsearch wrote: post #163

Earlier quoted context omitted.

I’m undecided on Bitcoin. Happy to be called ignorant, but only if you can explain why. There are many ways of transferring money across the internet. Why is Bitcoin special if that’s the reason for its value? Genuinely want to be won over.

You can buy drugs or a hitman online without being traced. Also ransomware can demand payment in Bitcoin without being traced.

Also, I can buy a pizza for a coworker in a different country without worrying about exchange rates or anything else.

FYI, everything you said can be done with cold hard cash.

Re: Are You Trading or Gambling?

#209

Post by WrtCdEvrydy »

paulgb wrote: post #173
olalonde wrote: post #171

Earlier quoted context omitted.

Wait until you hear about US dollars.

There are many differences between the two, but one of the more obvious ones is that nobody is running around claiming that US dollars are a good investment.

I mean, the US does... every time the question of whether US bonds are worth it, the answer is always "sure, it's backed by the US government"

Re: Are You Trading or Gambling?

#210

Post by kortilla »

yummypaint wrote: post #122
bidirectional wrote: post #83

Earlier quoted context omitted.

How do you explain all of the HFT firms that have gone out of business over the years? They're competing with each other, it's a very competitive space that doesn't even capture that much value compared to the people they replaced.

To win at HFT you have to have lower latency than your competitors. The NYSE rents server space in their building for this very purpose and makes alot of money doing so. If you don't have hardware there you will go out of business trying to compete with those who do. From a broad perspective it kind of looks like companies being allowed to skim freely from the market so long as the right people get their cut.

Getting early views of an order book and trades does not allow you to skim. No matter how close you are to the servers, you’re still seeing the data after the order has gone in and has either been matched or entered into the order book. There is no way for them to beat the order.
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