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High-Class Gamblers
By Money Sick | November 5, 2007
People who are uneducated only can bet on numbers, TOTO, 4D or horse-racing. People who are educated, have a much wider scope of gambling. They can read and they can write. They can do research and they can technical analysis and charting. They can chat on forum, gossip about companies results and spread rumours about companies news. This sort of gambling by the more educated people are share investment. Sometimes, the not so educated of people will enter the stock market too. These are the housewives, the labourer, technician, and so on. They listen to rumours, and recommendations from friends.
In my opinion, Stock and shares investment is a far better gamble than TOTO and 4D. Although TOTO and 4D offers a higher returns than stock and shares, the latter is much more ‘safer’. If you place your bet for Saturday, Sunday and Wednesday, if you do not win the numbers, you risk losing all your capital. If you place the money in shares, you will not lose all your money. If you lose your money in shares, you can hold it. When the price goes up, you sell it to make your money. Sound that easy? Nothing is easy in this world. If everything is easy, there won’t be money swindlers and thief in this world.
Investing in stocks and shares can be easy and can be difficult, depending on how you look at it. It is easy because anyone can open a trading account and they can start trading. A housewife can ask their broker or remiser to buy shares for them at a certain price. Don’t know what share to buy? Broker and remiser is very good at recommendation. Whether their recommendation is good or bad is another story. After the shares are purchased, the housewife hope that their share price will increase. When increase, they are happy. They asked their broker to sell their shares when they are satisfied with their earnings. No homework need to be done in this example. The housewife relies information from broker and friends. This applies to the not so educated type of worker as well.
The next type of people is the more educated — read more, learn more type. They analyze company data, company results, performance and read company news. They follow Joseph Cycle, Candlestick charting, and whatever sort of technical analysis and prediction of STI.
There are a few types of investors. Investors are people who buy and sell shares in this case.
1. Cash Rich
The first type of investors are those who have money to hold on to what they own or buy. These are the cash rich type of people. They invest only money which they have and money which they have set aside for investment. Even if you are not really rich, what I mean by cash rich is the ability to hold your shares with all the money you have.
2. Marginal
The second type of investors are those people who use margin account or loans to invest in shares. Using margin account enable investors to buy more shares with lesser amount of money. There are interest incurred for any loan amount. If share price drops, the broker or remiser will call the investor to top-up more cash. This is obviously not that safe, but is a way to earn money.
3. Cash Poor
The third type of investors are the pathetic ones. They have poor financial planning. They do not know the correct way to build wealth. They have a totally wrong kind of financial planning pyramid and they are using money which are not theirs to invest. Money which are not theirs are money which comes from banks, come from loans and credit cards. For applying loans to invest in shares, you have to make sure that your shares must be yielding you earnings of as high as more than 25% at least. If that is that easy, why are there more and more people giving talks and seminars or even workshops?
Talking is easy and people always want to listen. Just like children love to listen to stories. For giving talks and seminars, you do not need to face objections and you do not need to risk your hard earned money. Holding talks and seminars, all it takes is your time and your sharing of your knowledge.
It is obviously good if you do not know anything and you attend talks and workshops to increase your knowledge. But it is obviously not going to help if all you do in your life is listening to talks and attending seminars about earning money, about share investing and you are not doing anything at all.
Seeing the need for the market, the smart people create money-making opportunities for themselves. This attracts the money-minded people, those people who want to earn lots of money and easy money in the shortest possible time. They collect course fees and talks fees in exchange for their knowledge about making money online — share investment, option trading, and how to make money online etc.
If these people are so good at spotting shares and so good at Technical Analysis, why don’t they show hand once and for all and they can reap their rewards. Why take the trouble to book for seminar rooms, prepare slides and rehearse for your talks? If option trading is so easy, earning you big money, why do you bother to sacrifice your time to teach? If selling insurance and selling real estate is that easy, why do Tom Hopkins want to write books and why are there so many motivational speakers around?
The fact is technical analysis is just like fortune telling. You have your lines and all the features on your hands and face and so on. But that are all guidelines. Nobody can be 100% sure. Just like gambling in the casino. Nobody is sure what is the next card going to be. You can only predict. Wrong prediction, all your money gone. If these people are so smart and so confident about themselves, they do not need to come out of their comfortable shell to face the world. Who do not want to stay in their comfortable shell to enjoy warmth?
In my own views, share investment is regarded as a way of accumulating your wealth. Nothing should be placed 100% of your time or money. Proper money investment is diversification, diversify and spread your risk, spread your assets. Investment should be held long term to see results and not trading in short term, as in buying and selling — numerous transactions done in a day, this is gambling. Relying on news, reading news, monitoring index and spreading news, day in and day out. This is in actual fact, gambling with stock and shares. This is the high-class gamblers. They have lots of choices to gamble. They can gamble on balls (soccer), they can gamble on casino and they can gamble stocks and shares and even with their life. If you are lucky, you win, if you are unlucky, you lose. Have no money to hold on to shares when price dropped. They are forced to sell when price dropped. When you gamble, how many times can you win?
They do their homework, their read technical charts and listen to news, and chat about it in finance forum. To term it in a nice way, these people are speculating in shares. To put it in another easy term, these people are gambling with stocks and shares. These are again the high-class gamblers.
Topics: Investment, Life, money | 2 Comments »
2 Responses to “High-Class Gamblers”
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November 6th, 2007 at 3:48 am
[...] High-Class Gamblers | [...]
November 6th, 2007 at 3:52 am
[...] week, within a month and every year doing the same thing, these are basically gambling. I called it high-class gamblers. Betting on SL Stock Exchange, can you really earn money? I agree with TechCrunch – After [...]