Is TRADING STOCKS GAMBLING……

There is a myth in the market that the stock market is just like gambling. People who invest in the financial markets are just speculators and are lucky enough fir their trade. Although these are a few similar features to investing/trading and gambling. They are very distinct. The varience in risk and return is the point of distinction between gambling and trading. In stock markets yield may be greater than risk while the risk is greater than yield in gambling. Stock markets encourage us to be both a buyer and a seller, while you can only be a buyer in gambling. Given the above peole,lose money mainly in stock markets because they put money into stocka without knowledge or analytical skills. If you treat stock trading like a gambler, so it is certainly gambling for you. In the stock market you have an edge called statistical advantage, the key to success is doing continuous research, and you make decisions that are more informed whereas in gambling you more depends on the luck factor . Trading will be similar to gambling when you just take random stocks and make transactions. When you invest in something to generate profits it becomes business. In business or trading, reward to risk is high, people lose money only when they fail to understand the risk to reward ratio before arriving at any decision. In gambling most of the time it is the dealer bookmakers and casinos. Who generate profit you speculate and the odds are never in your favor. Gambling is psychological and related to the lottery where you are ready to lose asmall amount of money in anticipation that you will get a large return. In trading you can predict or define your large of rate of return. Not only do gamblers trade with thoughts in dreams, but also with a risky lack of market analysis and risk management Their purpose is to trade not to study charts and monitor risk. Traders tend to focus on profound research and logical thought. In games such as poker,some elements make it more like trading. If you are smart enough and apply analytical skills there are chances that you can bring yourself in a position that can increase the probability of winning and bring down the odds in yours support. At same point in time, traders might have gotten lucky or unlucky based on different circumstances but in long run. It is all about making informed decisions based on certain strategies, skills, risk tolerance and other parameters etc. Trading however if done skillfully and art fully can put you in the position of the house and is no more gambling. The trading strategies should not be complex rather well tested and in limits with a disciplined approach. A trader predicts the market trend based on past trades and accordingly plan their strategy for every trade using technical and mathematical analysis. A must requirement for stock trding is logic and reasoning. Investors judge provious trades and then prepare their approach i.e ,where to spend, how much to buy and how much to spend. The best traders have theirs exit plans in place before entering into the market. Trading in futures and options should be used a risk management tool for hedging purposes. For Ex.. You are a former and believe that the price of your goods may came down or go up. Out of any negative situation hence took a position in commodity futures to offsets risk on the current product. The key to success in diversification monitoring and follow the trends and respond quickely. Trading is a long term game but its short term Excitement appeals to many people. A winning trade provides them with the dopamine rush required, where a losing trade induces great pain. A suvcessful trader has consistency selfcontrol, and emotional well being. Stock market trading is very volatile and depends on many factors. Hence volatility factor makes it very difficult to predict. In gambling one wrong move can kill your financial wealth, emotional stability, and something your relations too.