It has often been said that investing in the stock market is just like gambling at a casino. This statement can be true or false, depending on how you look at it. But what are the indisputable facts? What is the truth about these modes of investments? We made an in-depth analysis, and here are the similarities and differences between casinos and stock markets.
Similarities Between Casinos And Stock Markets
In a sense, casinos are very similar to stock markets in several aspects. Some of the outstanding similarities between gambling and investing in the stocks are as follows:
Risk - both involve risking capital with the hope of a future profit
Choice - You will have to choose between options in both cases
Volatility - there is considerable volatility in both casino games and investments in stock markets
Analysis - just like gamblers study probability tables and the strategy guides, savvy investors study companies and markets
Differences Between Casinos And Stock Markets
However, there are several fundamental differences between putting your money in a casino and the stock markets. The main differences are:
Time
It takes a shorter time for you to get an outcome in a casino than in stock markets. When you bet on a casino game, it takes between seconds to a couple of hours depending on the game for you to get results. That means you can make money really quickly with gambling. On the other hand, investing in the stocks often needs some considerable time for the value of the shares to grow to a level where you can make a profit when you sell.
Profits
The profit margin is higher when it comes to casinos than in investing. In case you bet and win, you will end up with a higher amount of money than if you would if you put your money in the stocks. Stocks are more a long term form of investment that give you gradual profit.
In the same fashion, your losses will also be more if you lose at a casino than they would in investing. We also recommend to gambling only with the money you can afford to lose.
Capital
You will need way less money to gamble than you would to invest in the stock markets profitably. Now that the profit margins with the stocks are on average small, you will need to invest more for you to get significant returns. On the other hand, most casinos have very low minimum deposit amounts.
Ease Of Use
Using casinos is way easier than investing in the stocks. Many casinos have efficient payment options like Skill which make deposits and withdrawals super-fast, hassle-free and anonymous. Some of the best Skrill casinos include 888 casino, Bet fair and King Billy Casino. Once you do have funds in your account, betting on a game is straightforward.
Value
Investing in stocks is the exchange of value. Investors own a share of a company or companies and therefore, will receive dividends if the company is profitable. When the value goes high enough, an investor can sell the shares at a profit. In gambling, you own nothing. You are basically leveraging on probabilities.
Risk Level
Last but perhaps the greatest, is the difference in the level of risk. It is riskier to put your money in a casino than in stock markets on average. The bookie has a mathematical advantage over a gambler. You are therefore statistically set to lose your money to a casino. Stock markets, on the other hand, are relatively profitable. Even if the shares drop in value, you will still sell and get some money out of it, unlike when you lose on a bet.
Your risk in gambling can be reduced through luck, analysis and practice. You cannot control luck, but you definitely have control over analysis and practice.
As you can see, the debate of whether to invest in casinos or stock markets is nowhere close to being concluded. But now you have all the similarities and differences to help you make an informed decision. All the best as you make money.
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