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is stock market a gambling?

  1. profile image0
    jomineposted 7 years ago

    we might be able to invest in different sectors, but how can we predict which industry or which sector will be going up?
    what are the indicators to say the stock market is not going to crash or what are the indicators to say it is only in a correction and not recession? minimum are there any indicators to say that you will not lose money..?

    1. Wayne Orvisburg profile image73
      Wayne Orvisburgposted 7 years agoin reply to this

      The stockmarket is not like gambling. It is risky, but not gambling. You can't predict exactly which stock or sector will be going up from day to day. You can however, make a calculated assumption based on income statements, buying trends, and news reports.

      The key to being successful is having a long term plan, diversification, and education.

      If you plan on daytrading, that is a little closer to gambling, but there are methods to use that may limit your losses. As opposed to gambling where you win or lose.

      Lets not forget, you can also make money on stocks going down. I wrote a hub about that one. You should check it out.

    2. profile image44
      sfgmailposted 7 years agoin reply to this

      Its not gambling if you deploy proper risk management.  So get educated about that and utilize a 21st century solution such as SmartStops to best manage your risk.

    3. dreamdairy profile image58
      dreamdairyposted 6 years agoin reply to this

      first of all stock market is not a gambling. we can predict it by taking in account the fundamentals and technical aspects of it.

  2. Kidgas profile image78
    Kidgasposted 7 years ago

    No the market is not gambling at all.  With the proper knowledge and education, it is possible to make a living trading the market.  It does take quite a bit of effort but is possible.

    It also take appropriate management techniques to prevent losses and know what to do when the stocks move both from a buying as well as the selling side.

  3. marketHEIST profile image58
    marketHEISTposted 7 years ago

    The stock market should not be gambling, but yes many people treat it as such.  Those who depend on successful investing or trading treat the stock market as a business: evaluate risk, reward, forecast estimates, and understanding the environment.

    Simply put, the stock market is a environment of probabilities. For example (hypothetically), if 9/10 years oil rises into the summer because of the driving season, you can take a defined part of your porfolio, a defined risk, and buy oil.  Airlines, trucking companies, and other industries thats affected by the oil price will be making adjustments in anticipation of oil rising into the summer.  Are the airlines and trucking business gambling?  No.  They are managing their business risk, just as a stock market participant should.

    The 2nd part is knowing the statistics of your defined strategy.  Some strategies involve one or more indicators or financial data.  either way, you have to find under which conditions a particular strategy has a 50%+ success rate.  Like a uneven coin, if you know it tends to be heads more than tails, you can keep betting heads and eventually come out a winner.

    Will it be heads every time?  No.  That's why you have to manage how much you risk each time.  You may lose 2 in a row, but as you keep betting heads, after 20 flips you may win 11 times and come out a winner.

    That's the beauty of the stock market.  You can legally play uneven games, always bet on the side favored to win.  You can craft any strategy with any indicator, bet size, time frame, and design strategies with 60, 70, 80+% win rates.  Its really up to you.

  4. profile image0
    Kstroud33posted 7 years ago

    That is a loaded question. If you put money into the stock market, commodity, or forex market and you do not know what you are doing then you ARE gambling. The market can move against you and if you are using financial leverage then the market can move against you quick. If you don't know what to do you can lose a lot of money fast. It all depends upon one's trading skill, level of knowledge, how much risk capital they have to put up, what there goals are, ect.  If you know what you are doing then it is not gambling.

  5. fxdaddy profile image59
    fxdaddyposted 7 years ago

    Only if you treat is as such.  Get educated and follow trading rules.

  6. strawberryhill profile image53
    strawberryhillposted 7 years ago

    An interesting question that will I am sure divide opinion.

    To a certain extent, the level to which it is gambling is based on the amount of time, effort and research you put into what you are investing in.  You can never know for sure what will happen but it is entirely possible to minimise the risks and if you trade sensibly with a strategy that you stick to and obey some basic laws of common sense and trading logic you can again minimise potential losses.

    Good examples here are to research your stocks carefully, set stop losses on your trades and lock in profit as the stocks go up.

    Remember as well that historically 90% of stock market gains have come from reinvesting dividends over the long term....

    Happy investing!

  7. Midasfx profile image66
    Midasfxposted 7 years ago

    Do I think it's gambling? NO. I think buying a stock is more like buying a house.

    You look at it, check out the outside, the inside, see what renovations need to be done. See what other houses are selling for in the area. Is the neighborhood values on the rise. Would I like to own this house for the next 5-10-30 years?  It is based on well researched facts and opinions.

    ~ But ~ then again we have the famous saying, Wall Street is the "other" Vegas ... lol

  8. profile image52
    Trading Richesposted 7 years ago

    Everything we do in life is a gamble to some extent. However with regards to stock market investing, you can find plenty of companies, such as Tesco for instance, that grow their earnings and dividends every single year, and have done so for the last 10-25 years. So if you buy these kind of stocks on any dips then you won't go far wrong.

  9. Flightkeeper profile image72
    Flightkeeperposted 7 years ago

    In some ways it is because of the unpredictability.  If you invest, be comfortable with losing the amount of money that you'll be investing.  Try index funds if you don't know much about it at first and read more on investing.

  10. Gordon G. profile image60
    Gordon G.posted 7 years ago

    Definitely not gambling. If it were then there would be no Warren Buffett or Benjamin Graham. It's a risk but as long as you do your homework, it's very possible to make money.