Key Differences Between Investing And Gambling

Unlike gambling when you are completely betting on the game of chance for no specific reason other than to amass personal gains for yourself, investing involves you actually providing help.

With all of the information about the unpredictability of investing and all of the potential risk factors, especially when it comes to stock investing, it is easy to see certain similarities with investing in the stock market and really just playing a game of chance with your funds.

Afterall, the goal of both of these things is to increase wealth and have your money work for you. Is the stock market something of a casino? Is investing a form of gambling or gambling a form of investment?

The truth is that it is easy to see how both of them can offer the same results especially when you think of them on the basis of risk and return. However, they are not in any way alike.

For starts, investing involves setting aside money to purchase something that is capable of offering profitable returns and gambling is a pure game of chance with unfounded risks to amass a lucky gain.

In terms of what they provide to the society, it is not normal to see a company that is driven by gambling. Rather, investments are seen as the tools used to drive capitalism. Unlike gambling when you are completely betting on the game of chance for no specific reason other than to amass personal gains for yourself, investing involves you actually providing help.

With their funds, they put money in the hands of people who want to use those funds to accomplish their goals towards changing the society. Gambling offers no value beyond what potentially comes to the investor. Beyond these basic reasons, here are other differences between investing and sheer gambling:

Investing wants you to win and gambling wants you to lose

The odds of investing have been designed for shareholders and investors to win. With their funds, companies strive and do everything they can to ensure that the value of the stock or company goes up. However, with gambling, you are generally expected to fail. The odds are completely against you and winning is an outlier.

Investing is usually for a lengthy period while gambling is one off

While not all investors are very good at leaving their funds in the market for a long time, it is not likely that investors put in their money and expect it to have “magically” increased in 5 minutes, 24 hours, or other periods of time that are simply too absurd.

Investing is tangible and gambling is just not.

Even before your investments materialize, you have documents that show the journey you’re on. In many cases, those documents like share certificates are regarded as assets that could be useful in terms of adding to your value when defining your net worth amongst other things. However, gambling is complexly intangible – there’s just nothing to it.

Investing is not based on emotions or wishes

Investing is not a wish. Rather, it is based on skill and the use of a system that is based on research and a myriad of other logical elements. However, gambling is the same as wishing for cloud on a sunny day even when the weather report says it’s going to be sunny – it is possible that it might change, but it most probably would not. This is because gambling is based on luck, wishes, and emotions.

There are so many more reasons why investing and gambling are in no way similar. However, we can really summarize it as: Investing is good and gambling is bad. It doesn’t really get more different than that.

Written by Lawretta Egba.