How Different Is Gambling from Investing?

 

Image via freedigitalphotos.net (Stuart Miles)

You may have heard people saying that investing is just like gambling. There’s no complete certainty that an investment will result in gains in the same way you can never be sure if you will win or lose in a fair betting or gambling game. However, these two are certainly different and distinguishable from each other. In particular, they can be differentiated by how the possibility of improving your chances of winning works in each of them, as well as in their respective overall chances of success. You can enhance your chances of winning in gambling with the use of statistical based betting tools.

Improving Probability of Winning

A notable difference between investing and gambling is the possibility of improving the chances of winning or success. In investing, if you do careful research and analysis of the relevant data gathered, you can greatly improve your investment decisions, which can lead to the desired earnings. You can make investments randomly but if you want to raise the chances of succeeding with your investments, you need to spend effort and time to carefully scrutinize your investment options.

Statistical tools have been developed to scientifically calculate probabilities in gambling. They help increase the chances of winning based on established statistical principles and data obtained from various gambling types and instances. Whether or not they really help gamblers win more may not be an established fact but there are those who swear by their usefulness.

What’s different between these two ways of improving the probability of winning is that in investing, you are given a wider and more palpable range of data with which you can make more informed decisions. This data is not just mere statistics but also includes market trends and updates on the latest sociopolitical developments that can affect investments. With gambling, it’s all about stats or final suggestions you wouldn’t appreciate if you are not that knowledgeable about statistics.

Chances  of Success

On the other hand, investing and gambling can also be distinguished based on your overall chances of success with them. When comparing investing and gambling, it’s a no brainer that chances of success are always better in the former than in the latter. Fact: you will most likely earn more money by investing it than by using it in a betting game. Just imagine what happens if the probability of success in investing is similar to that of gambling. If that’s the case, almost everybody would already be gambling. Both investing and gambling involve luck. However, this luck component is widely perceived to be minimal in investing and greater in gambling.

So how different is gambling from investing? They’re quite different. Investing can be like gambling but it’s obvious which one is better if you want to grow your money. Both involve risks but these risks are more manageable in investing. There’s more success in investing although for some the process may not be as exciting and gratifying as it is with gambling.

 

 

 


Categories: Investment

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August 22, 2017 How Different Is Gambling from Investing?