The stock market is not a casino. Investing in shares is nothing like gambling
Investing in shares over longer terms is nothing like gambling.
The stock market is not a casino.
Gambling - unlike investing in shares - is a zero-sum game whereby money is taken from the loser and given to the winner.
Nothing is given in return and no value is created.
When you invest in the stock market, you’re buying a piece of a company.
You become an owner of the company’s assets and you share in its profits.
How is this like gambling?
The value of shares is extremely volatile over short terms.
So, it’s a “gamble” in the sense that, if you’re in it for a quick gain, then you might have to sell when the stock is down, thereby losing money.
However, even if the value of the shares you own falls, you’re not left with nothing, you still own part of a company (admittedly one that is worth less than before) and next month the stock might be up again.
Stock market investors don’t just randomly chuck their money into an investment.
There might be some uncertainty regarding outcomes, but you're not simply hoping that luck is on your side.
(Click here for more personal finance articles.)
Get the 10 most-read articles of the week from Bruce Whitfield’s The Money Show, emailed to you every Friday morning:
The bank is one of only six in the world to be recognised in this way for outstanding performance during the global health crisis.Read More
Everything is done electronically – you never have to leave your home, says Mortgage Me’s Andrea Tucker.Read More
[EXPLAINED] The Money Show’s Bruce Whitfield interviews Craig Wilson, Editor at Stuff Magazine.Read More
Shoprite is exiting the oil-rich but spending-money-poor nation. Bruce Whitfield interviews Dianna Games (Africa At Work).Read More
The Money Show’s Bruce Whitfield interviews Natascha Viljoen, CEO at Amplats.Read More
It still argues that the lockdown, not the pandemic, is responsible for its clients’ losses. Bruce Whitfield interviews its CEO.Read More
As widely expected, Sarb Governor Lesetja Kganyago announced a repo rate cut of 25 basis points on Thursday.Read More
"Consumers who are in debt have received a huge bonanza," says Econometrix Chief Economist Dr Azar Jammine.Read More
"This case shows rogue officials at Sars that the courts protect taxpayers," says tax attorney Jean-Louis Nel (Tax Consulting SA).Read More
South Africa has become poorer, says property economist Erwin Rode. If you force a tenant out, who will you replace her with?Read More