Investing is not gambling
When I discuss investing with people I know, I notice that people can be very dismissive and are likely to repudiate it and say "it's just gambling anyway". This couldn't be further from the truth. It is important to draw a clear distinction between the two.
Gambling
In the case of gambling, you know your potential returns from the outset and there are two outcomes; you win that fixed amount of money or else you lose all the money that you gambled. Your soccer team either wins and you win that amount or else they lose and you lose your money.
Investing
When you invest in a company, you now become part owner of the company and own a piece of the pie as it were. If the company does well, you may receive a share of the profits in the form of a dividend and the value of your initial investment may increase. Alternatively, if the company does not do well, the value of your investment may fall.
The key difference is that when you gamble and the outcome is unfavourable, you can only return to your original position upon a favourable outcome of a second bet. Whereas, when you invest, a decrease in value may be counteracted by a subsequent rise, without the necessity of putting forth a second capital sum.
As Warren Buffet said ; “Rule No. 1: Never lose money. Rule No. 2: Never forget rule No.1”.
Well, to me, I could say that investing is gambling and not gambling at the same time. I know how ridiculous this sounds. However, if you invest in a start-up idea, you are doing so with the hope that the startup idea wuld become big. There are high chances that the idea would not see the light of the day, and that's when investing could also be seen as gambling.
The above is just one of my unpopular opinions.
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