Stock Brokers: Gambler’s In Suits?
Marc Armstrong ENI, long ago, decided never to be a stockbroker. Why? Well, because I hated the idea of getting extremely wealthy, driving a sports car, and owning a great deal more large television sets than I knew what to do with. It all sounded like so much hassle to me…
To jump to where I start talking seriously about my topic; I recently read a fascinating article based around the idea that stock brokers are nothing more than glorified gamblers, who very simply place bets on the stock market, as opposed to casino games. Intrigued with the idea, I decided to research what stockbrokers actually do, and discover if there was any truth to the notion. And, wouldn’t you know it, it turned out there was a great deal of truth, far more so than I dared to imagine.
Stockbroker Versus Gambler
I discovered that being a stockbroker was very much about making predictions, and putting down money on those predictions. Or, to be more specific, buying shares in a company, based on the notion that the price of those shares will increase.
It works like this; if you decide that a company, let’s choose a random company name and call it Online Casino-World Incorporated, was due for a boost in value in the future, maybe because online gambling was soon to became legal in a key country, you could buy shares in the company, in anticipation of that value boost.
So, when the value of the shares purchased goes up, profit is made, since the value goes beyond the original purchasing price. That’s what smart business people in suits call investment.
Of course, if the value goes down, the same rules apply, and money is lost. The trick is, though, that a person can never know for sure if the value of the company will go up, or down. It is 100% guessing. Yes, a person can have a good idea if the price will go up or down, based on various factors examined, but it can never be known for sure. And that, ladies and gentleman, is gambling.
Gambling Is Gambling
A person can have a good idea if one football team is going to win when going head to head against another football team, but not know the result for certain. Upsets happen, even when it seems as if the result is obvious. This is the nature of bet making.
A person can likewise have a good strategy going into a game of roulette, or into a game of poker, but the results are never known for sure. Steps can be taken to avoid losing money, and maximise the chances of winning, but the result is not set in stone. This is the nature of casino games.
And, a person can buy shares in a company that seems destined to gain massive value, given recent events. Like, say for example, the CEO of a company opposing Online Casino-World decides to quit the business and become a flamenco dancer. One would sure be wise to invest in the opposing company, wouldn’t they? But, who could have guessed that the CEO on Online Casino-World itself would quit and unexpectedly dedicate his life to being a ventriloquist. Silly example? Yes. The point being; you just don’t know for sure. Unexpected things happen. And this is the nature of the stock market.
Is The Stock Market Gambling?
So, is a stockbroker just a gambler wearing a suit? I would have said no, there are differences before I started doing my research. But, truth be told, I honestly think that there is very little real difference, at the end of the day. There are various subtle differences, of course, but at the end of the day a person is investing on unknown results, and that, to me, is gambling.
Now, I know what you’re thinking, and I thought the same thing. But no, I don’t believe a person can simply declare themselves ready for the stock market, just because they happen to be particularly good at poker. I’ll tell you one thing, though; I sure don’t think there are rules against playing poker in your finest suit!
