Following a recent piece that we did covering professional gamblers, we have had many of you writing in, asking whether or not a gamble or bet can be classed as an ‘investment’. What do you guys think? Is it an investment when you find a slot machine at https://www.australianonlinecasinosites.com/online-pokies/ and drop some dollars in? From our point of view, no matter how it is argued, we say that this is not an investment, and here is exactly why we hold that belief for gambling at any best high roller casinos USA based or elsewhere.
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Similarities
There are many similarities between gambling and investing, hence the confusion regarding what each means. For example in each, one must assess risk and factor it into the decision, each seeks to profit from the original capital invested, and neither the market nor the odds are in your favor for the most part. Despite these likenesses, there are some core differentials between gambling and investing.
Risk Factor
Many think that the risk factor involved in gambling is what makes it a non-investment, but this isn’t strictly true. In fact, when it comes to investing your money there is always a risk, solid returns are never guaranteed. Much like in gambling, you will weigh up the pros and cons, do your research, and hope to make money, but there are no dead certainties.
Betting on Yourself
There are also those who believe that you are investing in yourself and your own abilities when gambling, and therefore it should be considered an investment. There are two sides to this, however, that showcase why betting or gambling isn’t an investment. Firstly, your own skill levels do not always dictate whether you will win or lose, given that so many gambling opportunities come down to chance. Secondly, should someone invest in you they will look deep into your abilities and they could potentially decide that you weren’t worth the investment. This kind of research is something you’d never do to yourself.
Appreciation
Another aspect that we have to consider here is that most markets appreciate over the long term. This is not something that happens in the world of betting. The fundamental difference here is that gambling, even long-term bets, is a one-and-done deal. Investment on the other hand offers the choice between long-term, short-term, or a one-and-done deal.
Mitigating Losses
In both gambling and investing, it is critical to avoid losses. Unfortunately, in the world of gambling that is not very easy, especially not in comparison to investing. Gamblers may be able to cash out a losing bet, but not all places offer that, and that would mean outright accepting the loss. Investors have numerous vehicles that they can use in order to prevent losses or at least minimize the damage that they cause. Stop-losses, reinvestment and migrating funds are all simple ways to help investors avoid big losses and protect their capital.
And so, whilst investing may be a gamble, we can safely say that gambling is not the same as investing.