[gnaritas]

> Remember, the stock market is just gambling.

That's quite a claim, where's the evidence to back it? There are funds[1] that have consistently beat the market every year for decades, their very existence disproves the gambling hypothesis.

> What do you know that the pros do not?

You're not playing the same game as the pro's so it doesn't really matter. Hedge fund/mutual fund managers are playing with millions/billions of dollars which requires massive liquidity and carefully planned entries and exits over a period of time in order to not move the price too much; that's a completely different game than what a retail investor plays and that means retail investors can chase profits in areas too small for the big guys to play in.

In other words, you don't have to beat the big guys, you're not fishing in the same pond nor playing the same game. Retail investors can enter and exit trades instantly without having to worry about liquidity or slippage, two concerns that dominate the big guys strategies. When you're small, you're nimble in a way the big guys can't be.

[1] https://en.wikipedia.org/wiki/Renaissance_Technologies

[chillydawg]

Every single trade you place has several costs associated with it. Things like the direct cost to the broker, and the implied cost of half the current spread. I do not believe that most people have the skill or discipline to understand the difference between happening to make money and properly making money long term.

As for it not being gambling - there's nothing stopping you beating bookmakers. It's doable, but you need to spend an awful lot of time researching sports (or whatever). It's the same with stocks - the vast majority of people are essentially just taking the spread and making expected losses on every trade, which the bookies (market makers in stock terms) soak up. A few people can spot outliers and take only those bets and make money long term.

I stand by my claim. If it's so easy to make money on the stocks why isn't everyone doing it?

[gnaritas]

> I do not believe that most people have the skill or discipline to understand the difference between happening to make money and properly making money long term.

Sure, and I agree on that point.

> If it's so easy to make money on the stocks why isn't everyone doing it?

No one said it was easy. Merely that it's not gambling; gambling implies that's it's random and you can't find any edge, but people clearly do find edges and make money consistently so it's not gambling, it's just damn hard. However, it's a fallacy to conclude that you have to be better than the pros to make money for exactly the reason I specified, the pros are playing a harder game because the more money you have, the harder it is to find alpha.

It's vastly easier to get a 10% return on a few tens of thousands that it is on millions or billions because of liquidity and slippage. You can't exit a losing position in the billions instantly like you can when you have a few thousand, or enter quickly, it's an entirely different game.

[tanderson92]

Lots of people are making money on stocks. But your overly broad claim that investing in the stock market is gambling is indefensible: when you invest in broad total market funds you are essentially betting on entire economies, because you are assuring yourself a right to future income streams.

How is that gambling?

By choosing proper low-fee funds you can minimize the brokerage fees (and you can buy securities at net asset value) so that half of your critique of long-term profitability is untrue.

[chillydawg]

If you had read my original comment you'd see that I said most people should never directly trade individual stocks. I completely agree that putting money into low cost trackers for things like the FTSE250 or S&P500 is sensible. You're giving your money to a pro, who then keeps your bets balanced and trades cheaply.

[tanderson92]

yes, apologies. I completely missed that.

[mod]

> That's quite a claim, where's the evidence to back it? There are funds[1] that have consistently beat the market every year for decades, their very existence disproves the gambling hypothesis.

No it doesn't. I was a professional poker player, and professionals have existed for decades. Their existence doesn't mean there's no gambling in poker.

If you're taking offense to the wording of "just gambling," sure, I can see that. Like poker, it's gambling with an element of skill. Or perhaps more aptly put, it's a skill game with a gambling element.

What makes it gambling is that you have no influence over part of the process. You can control your decisions (bet/fold/buy/sell), but the rest (company performance, turn/river cards) is out of your hands.

So yes, of course this is gambling.