Trading is Not Gambling Unless You Want it to Be:
The parallels between trading and gambling are undeniable. Taking part in both can result in fast riches (as well as fast losses), and as a result, many individuals view it as a gambling platform. While nothing is guaranteed on Wall Street in terms of gains or losses, it is certainly possible to put the odds in your favor – something that isn’t possible in a casino (unless you’re cheating). When you gamble at a casino, “the house” always has an edge (meaning your potential winning percentage is less than 50%). But when you enact a successful strategy and exhibit proper money management tactics, winning percentages can be well over 50% with trading.
Unfortunately, not many people are willing to put the time in to educate themselves and develop a consistently profitable trading strategy. The stock market attracts gamblers, but that doesn’t mean you have to be one. In fact, it’s best if you’re not. Educated and disciplined traders are the most consistent and successful. If you want to blindly throw your money around at various tickers, it may or may not work, but without a strategy/plan for each trade – sustainability is impossible. The key is to understand concepts like risk vs. reward, portfolio allocation, high probability setups, catalysts, etc. In the end, lining up all of these pieces correctly can be extremely rewarding for the traders willing to put the time and effort into it.
Related Post: How Much Money Do I Need to Start Trading Stocks?
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