Are The Money Odds Always in Your Favor?

There are two definitions that distinctly put a barrier between what investing means and what gambling means. Gambling is defined as risking your money by placing a chance bet on something that may or may not offer a profitable return. Investing is defined as placing an investment on a well-researched stock or share of a company with the hope of a high financial return.

Gamblers Odds

A gambler is at a disadvantage as casinos have the upper hand thus the odds are much higher for the gambler. Gambling luck is always unpredictable no matter how good you are at the poker table.

You don’t own anything in gambling. For example, the bets placed on horse racing. These bets are technically placed against other bettors. The odds are determined by the total amount of money bets placed on each horse.

Investors Odds

When an investment is made, you own a share in a company or companies depending on your investment portfolio. Generally speaking, you invest in a profitable company that pays out in dividends. Which, over a period of time, you benefit from financially.

When stock prices go up, your stocks should sell at a profit. Even though the stock market changes, either high or low, there are profits to be made if you’re in for the long-term benefit.

It is advisable to have a diversified investment portfolio as this minimizes the losses incurred by one or more companies. If invested long-term, you stand a better chance of getting the financial gains you initially invested for.

The Best Investments

Those who are new to the investment game may not know where to even start with making good investments. Studies have shown that the most profitable long-term investments have been with the stock market, bonds, and the property market.

Remember, thorough research in either gambling or investing always puts you in a better standing to make informed and strategic financial decisions. Whether you’re learning the basic rules of poker and blackjack games or have heard about a great company with high profits announced on the news!

Two Ways to Increase Your Wealth

When it comes to increasing your wealth, you want to make sure you’re doing it for a long-term investment such as your retirement fund or savings. In this post, we take a look at two different ways to make sound financial decisions in increasing your wealth. Both ways hold a risk and strategic choices but still have probable profits.

Speculation

Contrary to belief, investing or speculating is very similar. Both terms refer to taking a calculated risk with the uncertainty of a profitable outcome. However, thorough research of financial portfolios and reports are available beforehand to make sound investments in one’s capital. Decisions are also based on the strength of the economy at the time.

An investor or speculator buys and sells shares knowing full well the risks involved. The sound knowledge of the research made before aids in the decision of where the investment is to be made. Thus, there is hope for a high financial gain in the long run.

Gambling

We all know that gambling on anything including the popular sports betting is a game of chance. Bets are made using capital despite the uncertainty of the outcome of the bet. There is just hope that there is a high financial gain after a sports game.

With gambling, there are higher risks with the odds stacked up high against you. The probability of loss is higher compared to making a guaranteed profit.

Taking the Risk

It’s difficult to know exactly what you’re doing whether you’re investing or gambling with your money. Gambling is taking a risky bet on a short term gamble. Speculating involves strategic and analytical research to make a sound investment despite the risk. Investing in short -term investments puts you at a higher risk of losing.

Another thing to consider is whether you are emotionally connected to your investments. People are advised to keep a barrier between themselves and their capital used to invest or gamble. It is always going to have exciting moments of financial gain with just as many financial losses too.

The Difference Between Gambling and Investing

For those that don’t participate in either gambling or investing will be quick to say that both are a bad idea because it involves losing money. However, there are some key differences between the two. These financial activities involve risk and choice-making.

Investors

If we look at investing, we can see that investors have a capital they are willing to invest in a number of investments to reduce probable losses incurred if they only made one investment. This is called a risk management strategy.

When investments are spread over a number of assets, investors have options to reduce loss liabilities to protect their invested capital. When looking at investments made with companies, investors can invest over a long period of time to expand the profitable outcomes.

Gambling

Gamblers have a portion of capital they are willing to place bets on with an uncertainty of the outcome. The aim is to reduce risks while still achieving high profits. A common example of gambling is sports betting. However, there are no strategies involved to alleviate possible losses because it is speculative. Gamblers either win or lose a wager. It is not a long-term way of incurring high profits like investments would.

Studying Behaviour to Assess Risks and Profits

The Financial Study

A lot of investments made by investors are made on a daily basis through technical analysis. This means that companies study trading and stock reports to determine future stock trade profits and losses.

In the USA, there is the Securities and Exchange Commission which protects investors but also gives out financial company information to the public. This information includes company earnings and financial ratios to aid investors in whether it is feasible to invest their capital.

The Betting Study

Poker players don’t have anyone to rely on for valuable information to determine their probable winnings or losses. However, poker gamblers do observe their opposition’s body language to determine what their next move may be.

Pay close attention from start to finish of a game or investment made so you know where your next profit is!