Is gambling sinful?

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dochawk said:
Any time you’re trading based on news or market movements, all of the public information is already built into the price, and you’re aiming a bazooka at your feet . . .

Trading in such cases pretty much locks in your losses, while while missing out on gains that are pretty much built into the system!

(and, yes, I am an economics professor, though currently practicing law instead over tuition . . )
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Well, I am no economics professor; one class in econ was the driest thing I ever tackled - and that is with a BA in Philosophy.

I went to cash when the market was flat lining, and other than successes with bear calls right now, I am keeping my powder dry - so that when bottom is reached (not real soon, I project), I can get back in at the bargain bin we will have. I was actually out of the market the 3rd week of February, as I was hunting the last week.

And now eating the results. 😋
 
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otjm said:
so that when bottom is reached
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but that’s the catch–there I snow way of knowing.

Years ago, when apple was on the ropes, I calculated that it would liquidate for about $20/share when broken up–they still were the top quality hardware manufacture.

So I wanted for it to fall to $13.50 (to get a 50% return) before moving $5k in my Roth IRA to it.

But it never went below $14, and then they bought, err, acquired, Jobs again . . .

that $5k would be worth somewhere between half and a hole million now, even after the crash . . .

I just stay full invested, look at my allocation every year or so, and don’t make the changes. The one time I did, I ended up with energy holdings that have significantly underperformed the rest.

I put it in, and hold.

I horrify our KofC general agent, but I have about three times what I would had I invested the same amounts his way . . . I’ve built in an assumption of a 50% loss (and if I hadn’t, I would have retired last year!). I needed less than another 70%, but . . .

Anyway, the short version is by the time you can tell the market has bottomed, it’s not there any more.

I’m not offering financial advice, but the statistically strongest move is to put in equal amounts over a period of many months or a couple of years.
 
dochawk said:
I just stay full invested, look at my allocation every year or so, and don’t make the changes.
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And I am a trader, and would not buy a stock without a stop loss. And it was the stop losses in the 3rd week of February that got me looking at the charts and deciding to sit it out. It as not the loss amount (@ 2%) but the suddenness - all within 3 days that gave me pause.

In 2009 I was following someone who called the end of the 2007-2009 crash in March and I was paper trading at the time. I picked 5 momentum stocks to follow, and within less than 6 months, none of them had done less than double. And one might not be able to pick the exact market bottom, but it is not at all hard to see when a turn has been made.

Would that I had had the cash at the time to pick Chipotle at around $48; even now it is at $524 (and down from a high of about 926). Not quite Apple, but not small potatoes, either.
 
The first time that I taught Money and Banking (as a graduate student), I was surprised to find an engineering grad student in an upper division Economics class.

I asked him why he was there, and he explained that he had day traded profitably for a couple of years, below learning it all in a single day–and now wanted to learn the rules! 😝

[I also went to law school with a gem dealer who explained his presence the same way . . .]

Anyway, I bought an individual stock once, in Jr. High, and learned my lesson: of the four I’d narrowed it down to, the one I bought tanked, and the other three doubled to tripled . .

Since then, I"ve brought funds . . . (and done quite well!)
 
Like my mother said: “To each his own, said the old lady as she kissed the cow.”
 
I am curious as to what percentage of the stock price or purchase price , that you set to your stop at.
 
On some days the prices drop so fast a stop limit order doesn’t help.
 
Exactly. If the price falls too fast, you don’t sell. You hang on as the price falls.
 
Thank you. My IRA is doing fine considering. When it was a 401K when I was working, it dropped a lot during the 2008 Great Recession, but bounced back up with a vengeance. My IRA has dropped a lot again, but I haven’t touched anything and will let it ride out as it did in 2008. That being said, my 401K and IRA has outperformed the Dow Jones Industrial Average a minimum of 100%. Yes,100%.
 
Duke12VonFalkenburg said:
Enjoy gambling it is good fun.
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I think gambling can be an occasion of sin. People don’t think so at first, but then as they try to recoup their losses, and lose more, it is only then that they realize it was an occasion of sin. One thing that was often taught in the past was to avoid the occasions of sin, particularly the near occasions of sin. What does that say about gambling casinos? To put yourself in a near occasion of sin without a good reason to do so, can itself be a sin.
 
No complaints about that.

Someone who simply bought the SPY last year would have had a gain of 28%. Holding on to it would now have it down to where it was when the last Presidential election was held.
 
If the price falls and you have an across the board 15% stop loss, the market can go down further while you sit and wait, after getting out of the market.

With a 15% loss, you need to gain 25% once the market turns around.

If it is going down fast and you sit and watch, a 50% loss (which could have been avoided, for example, in this black swan) will require your portfolio to make 100% to get back to square 1.

Some people simply don’t know enough about the market or don’t pay enough attention to be able to do anything.

Others watch the knife fall, and as it is getting near it’s actual end (which the market does not tell you) finally have endured all the pain they can, and bail out, near the bottom. And the pain is so much, they can’t get themselves back in when it turns around. They do the most damage to their accounts, all of which could have been avoided.
 
AlNg said:
What do you look for when seeking a fund to buy? Do you check out ETF’s ?
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I concentrate on ten year returns. I peek at 5 years, but focus on ten.

Now, that said, I really am less than 40 years into a 75 year plan. This has let me take far more aggressive positions than most folks can.

I completely ignore 1 year, ytd, and even three year data.

I also pay attention whether there was a “major event” either recently, near the beginning, or just before the start of the 10 years, and whether something unusual might have driven returns for a large part of the sector.
otjm said:
With a 15% loss, you need to gain 25% once the market turns around.
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This is worth pointing out: percentages up and down are asymmetrical. For example, 10% up followed by 11% down equals zero.

and as for the so-called “Great Recession”: I don’t have any classes at the moment, but as an economist, using that expression on a graded activity would cause a serious reduction in score, if not outright failure on the assignment.

It was a garden variety, run of the mill exception. It is only unusual in that
a) it wasn’t followed by a normal expansion, but rather an eight year “interregnum” between the recession and the start of the expansion, and
b) the prior two recessions barely even qualified, and were essentially “breathers” in an extremely long expansion. The result is that a huge portion of the folks alive for the recession, including the junior reporters, had never seen a normal recession.
 
That is like saying that drinking alcohol is a sin because you could get drunk make stupid decisions. Obviously people who do not have self control with alcohol should stay away from it. But that does not mean it is a sin. For some people gambling is just entertainment. When they lose they dont try to recoup their losses. They accept that they lost and move on. They dont go down the path of excess and sin. The same is true with alcohol. It can be a great thing but once you add excess into the picture it leads to sin. The key word is Temperance! Temperance in all things!
 
In order to win a £1 someone has to loose a pound. In order to win millions on the lottery, then millions of people have to loose.
 
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