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INVESTING, TRADING, AND GAMBLING

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INVESTING, TRADING, AND GAMBLING Day trading isn’t investing, nor is it gambling — at least not if done right.  But the lines between the three can be thin, and if you know where they  are, you’ll be in a better position to follow your trading strategy and make  more money. And if you can avoid the trap of gambling, you’ll be better able  to preserve your trading capital. The difference between investing and gambling is the risk and return tradeoff.  In investing, the odds are generally in your favor, but that doesn’t mean  you’re going to make money. Some day traders end up gambling, and then  the odds are moving against them. And unlike in the finer establishments in  Las Vegas, no one is going to bring the failed day trader free drinks to help  ease the pain. A lot comes down to personality; if you are on a casino’s “do  not admit” list, you probably aren’t a great candidate for day trading. This starts off with a lot of gory details about risk and return. It