Difference Between Investment And Gambling Slideshare

1. Difference Between Investment And Gambling Slideshare Presentation
2. Difference Between Investment And Gambling Slideshare Social

• Gambling is mainly to do with pure chance, and there are a lot more loss-mitigation strategies when it comes to financial investments. Time is another difference when it comes to comparing financial investments and gambling. Gambling is a time-bound event whereas financial investing can last several years if not longer.
• The argument basically maintains that the difference between investment and gambling is the fact (and it is, admittedly, a fact) that a smart investor acting on the best possible information has a significant “edge” over the gambler. That’s not a distinction between gambling and investing, though.

Investing in the stock market and gambling at a casino are often compared and deemed to be very similar ventures. Both the difference between investment and gambling involve risk and choice in hopes of future profit. Investors and gamblers have to decide how much they are wanting to risk.

Investment Vs Speculation Basis Investment Speculation4.Insider trading analysis Not possible Based on insider trading transaction happen5.Stability of Income Very stable Uncertain and erratic6.Sources of income Earning of enterprises Change in market price7.Length of commitment Long run For a short time period PRESENTED BY:ANU MISHRA 8.

Some traders typically risk between 2% and 5% of their capital base. Long-term investors often spread their money across different investments in order to try and minimize potential losses as a form of risk-management.

Risk-management in gambling is also proficiently sought after by professional gamblers. They look at whether odds are in their favor before they make a bet. A key comparable principle in both gambling and financial investing is to minimize risk while maximizing profits.

Difference Between Investment and Gambling

However, there is a huge difference between investing and gambling when it comes to stopping losses. In gambling, particularly in sports gambling, there are no loss-mitigation strategies due to the activity being so speculative.

Stock investors however can set up stop losses on a stock investment which is the simplest way to avoid unnecessary risk. If stock drops 10% below its purchase price there is an opportunity to sell that stock to someone else and still retain 90% of the risk capital.

However, if you put a bet on that states that Tottenham Hotspur Football Club will come first in the Premier League, you cannot get any money back if they come second. You will lose everything you’ve put on, which isn’t the case when it comes to stock investment. Gambling is mainly to do with pure chance, and there are a lot more loss-mitigation strategies when it comes to financial investments.
Time is another difference when it comes to comparing financial investments and gambling. Gambling is a time-bound event whereas financial investing can last several years if not longer. Some companies that pay dividends even reward investors that have purchased shares in the companies for risking their money.

As long as you hold onto their stock, companies can pay you money. But when you’re gambling, you either win or lose your capital – there is no in-between.

The way both investors and gamblers play the odds and try to look for an edge to help enhance their performance is a huge similarity between them. When it comes to gambling, particularly games such as blackjack and poker, players often study behavior, mannerisms and patterns in order to gain useful information which will help them when it comes to their own betting.

Stock investors study trading patterns by interpreting stock charts in order to accurately predict where the business might be going in the future. However there is a difference in terms of how much information is available to both investors and gamblers. Information is valuable when it comes to both sectors, but stock and company information is always readily available and in the public domain.

Unsurprisingly, there is a limited amount of information when it comes to gambling. Sitting down at a poker or blackjack table in a casino gives you next to no information other than whispers about whether the table is hot or cold – all of which is relative to the other tables in the room. Essentially, gamblers go in almost blind other than from the information they can read and know about the players around them.

Although the idea that investing and gambling are somewhat similar isn’t untrue, there are far more differences that similarities when it comes down to aspects of information and time. Both involve risk and revolve around maximizing profit, but in general, investors have a much better chance at success than gamblers.

American Auto Brokerage has been serving Connecticut insurance consumers for 25 years. Our customers’ satisfaction is our #1 priority. Over the years this philosophy has enabled us to develop strong relationships with our customers who return year after year. We welcome you to become a part of the American Auto Brokerage family. In this short article, we hope to show just what insurance is, but also what makes it different from some other monetary schemes that are popular!

The Basics of Insurance – Where, How and Why

Insurance is a means of protection from financial loss. It is a form of risk management primarily used to hedge against the risk of an uncertain loss. An entity which provides insurance is known as an insurer, or insurance company. A person or entity who buys insurance is known as an insured.

Over time, many kinds and forms of insurance have evolved. The property, health and vehicle insurance are the most commong kinds, and it is easy to see why. All three things are extremely valuable, and we’d go at great lengths to protect their integrity. A damaged vehicle or home is a considerable strain upon one’s assets, and insurance is used as a way to reduce overall life stress by securing them.

The Biggest Question of All

Of course, it won't take long until the people ask the most important question of all, and that is: What is the difference between insurance and gambling? Why is insurance usually allowed whereas some countries take very strict meausres against any sort of gambling endeavour?

Legally and culturally, there is a clear distinction between gambling and insurance. Economically the difference is less visible. Both gambler and insurer agree that money will change hands depending on what transpires in some unknowable future.

At surface level, insurance really looks like gambling. Two parties agree on the consideration (by calling that wager a premium instead), the type of chance (by using expectations of when the insured might die, for example), and a prize (by referring to the winnings as a death benefit). It's a consolation prize for the beneficiaries but a prize nonetheless.

Difference Between Investment And Gambling Slideshare Presentation

The risk of losing money gambling to me seems less relevant than the risk of getting addicted to gambling and making irrational decisions. No one believes there's a problem with car addicts that the government needs to solve. There is, however, a real problem of gambling addicts, not too different from heroin addicts.

You can’t win with insurance; “break even” is the best you’ll get. On the other hand, your financial losses are limited with insurance. From a statistical perspective, gambling and writing an insurance policy are the same where we give a price to an odd. The main difference lies in their different purposes.

The purpose of insurance is to restore the insured to his original position, not to afford the injured person the possibility of making a profit. There might be gain in gambling. In insurance there is no possibility of gain.

However, that does not mean that there weren’t (unsuccesful) attempts to merge both gambling and insurance. Two inventors received a patent for a method and apparatus by which a gambler can protect against excessive losses. The invention involved setting up a machine inside the casino where gamblers could choose the amount of coverage needed. There is no record of this invention being installed or put into use at any casino.

Gambling insurance is quite unusual in practice because it may encourage a policyholder to place bets recklessly, compounding losses. As with all insurance, one must pay a premium to receive the coverage.

Difference Between Investment And Gambling Slideshare Social

As we can see from the explanations above, there are different ways to approach gambling. However, it not being allowed in certain countries is not a reason not to visit and play real money casinos; thanks to the magic of modern technology, all of them are just a click away!