Is Forex Gambling?

Beginner Questions
85

Yes, I am a “born again,” fundamentalist, evangelical Christian.

However, [U]to prevent more personal abuse[/U], my faith is strictly NOT open for discussion on this forum.
My faith is [U]private[/U], and is to be respected as such.

I do not know how " religion" got into the discussion.

[B]I was looking to generate a definition on the grounds of the Law of Conservation of Matter and Energy.[/B]

[B]I do like to keep my posts mathematically oriented because it eliminates all the ranting and raving to and fro which produces no results.[/B]
On the other hand, mathematics is an exact science.
It requires [U]clear thinking[/U], not debate.

By using this Law we can already start to discern possible differences between [B]risk [/B]and [B]gambling[/B].
We have not yet done this, but the Law gives us a basis to work from.

If we can nail the differences down, then we can use a definition of [B]risk [/B]to now differentiate between speculating and gambling.
I quote from a former post by [B]Clint, Honorary FX Member[/B]…

The difference between [U]speculating [/U]and [U]gambling [/U]is essentially this:

  • speculators assume business[B] risks[/B] which others wish to shed, in an attempt to earn a profit

  • gamblers create [B]risk[/B] where none existed, in order to engage in risk-taking for fun and profit.

As soon as we can clearly define [B]risk [/B]in terms of the law of conservation of matter and energy, then the above will also take on clarity.

We will then be making [U]some form of progress[/U] towards a defintion of gambing, instead of arguing to and fro about religious concepts and who does what.

88

Isn’t it about time to let this thread die?

If you have religious concerns, ask your faith leader.

If you have no religion, keep trading.

91

I am quite inclined to agree with you about letting this thread die. :slight_smile:
The points you raise make more sense than the continuous to and fro of religious discussion.

Unless there is some real remarkable mathematical breakthro or conclusion, I don’t think I will post here again. :wink:

92

ok…

93

Pliz dont burn down this shack too? If you burn it we’ll build another just as fast!

94

No offence tymen but if that’s the case, please stop quoting the bible.
Everyone have a good weekend. I’m done with this discussion too.

95

[B]This is a bunch of nonsense. There is no need to find a definition for, “gambling,” there is already a strict definition.[/B]

Just because you don’t agree that trading is gamling doesn’t mean we need to further discern the definition.

Plain definition of Gambling: “betting on an uncertain outcome” It doesn’t matter if its for gain or for fun or if what you are betting on is something you physically buy and hold.

This whole discussion is completely stupid. Someone asked if trading was gambling. Plain and simple it is. They did not ask for someone to re define the word gambling.

Some people don’t like to hear that because gambling is objectionale to their beliefs and or because they misunderstand the nature of trading, and think trading is a guaranteed business venture while gambling is just throwing your money way like a fool.

96

Really?

Here’s the first shot over the bow… This is an excerpt from your second post in the first thread.

Just so you know, this is not personal.

But the bottom line is, up until that point the subject had been discussed using definitions that did not include beliefs.

I agree with you wholeheartedly that religion should not be included.

No one should ever be under fire for personal beliefs. But when those are used as basis for debate, or the manual that belief is based on is quoted as basis for reason, it’s not a shock when it becomes part of the discussion.

And I’m with This Barb.

Give this thing a headstone…

97

yeah, i agree also that religion should not be included in this topic.
We have our own beliefs, let’s just commit what we want to commit and do the right thing, no one can blame anybody.

98

I quit posting on this discussion at the first mention of religion, at that moment it became pointless continuing.
The religious have an almost psychotic ability to live in denial.

99

Forex trading is not gambling since the risk probability exposure is fundamentally (logic and math) not the same.

Forex is a projection of world markets on a graph and though there is no actual exchange of the money (or share certificate) in question, I end up owning the value I purchase in a currency pair, i.e. if I keep the trade for two days within which my broker closes my account, he will debit me the value pinned on the side I own in the pair, even when I don’t get to hold the Yen in my hand, its my Yen still. In equities if one hold the security for too long one gets the certificate eventually mailed to him. It doesn’t matter if you hold it two hours or two months, it’s fundamentally and legally yours.

Hiding behind religious manuals or ‘my-mwalim-said’ won’t change that. It is okay for anyone to think whatever; it is also good to set such issues right in debate, not necessarily to switch anyone’s thinking or trading/gambling practice, but just to have it right. It is still alright when some choose to hold one view and block their heads to all others. Agreeing to disagree is a primitive compromise for knowledge, especially when that knowledge is essentially open-source. In the good ol days, we used to post chart examples with 100 members logged in & 20 members in the chat room, look what we’ve become… I’ll go hang out with the mechanics at MG instead, they’ll start & finish a good debate with no shots fired.

100

[B]Ah ha!! Breakthrough!![/B]
[B]
Out of the blue…[/B]

Now why did I not think of that? (duh) :o :o :o

… there is no actual exchange of the money (or share certificate) in question, I end up owning the value I purchase in a currency pair,

Of course!!
This is it!!
Your entry is just an exchange of currency types.
You still own your currency - just a different type.

i.e. if I keep the trade for two days within which my broker closes my account, he will debit me the value pinned on the side I own in the pair,

Exactly!!
If you buy a house, do you not do it at market value?
Did you gamble because you purchased a house?

even when I don’t get to hold the Yen in my hand, its my Yen still.

Sure!!
And if you buy a house, you do not have the money any more, you have the house.
The Yen in your hand is of value.
And I assume that if it is not in your hand (it is still your property) you could, if you really wanted to, withdraw your money from your broker in Yen.

The point here is that you can buy goods and services with your Yen.
The Yen you own are not worthless and they are your property in your wallet.

In equities if one hold the security for too long one gets the certificate eventually mailed to him. It doesn’t matter if you hold it two hours or two months, it’s fundamentally and legally yours.

Having begun trading with equities, I know the above to be absolutely true.
Furthermore, if the company pays dividends, you will get those too if you hold the certificate at the dividend payout time.
Again, such certificates are of value.
You can sell them again for money in the same way that you can sell a house for money.

[U]The breakthro I see here [/U]is that when you do your entry trade, you are making an exchange at the market value.
Just like you buy a house at the market value.
The house buyer has [U]something of value [/U](a house) and the trader has [U]something of value[/U] (the alternate currency).

So far, there is no gambling in that. :slight_smile:

101

[B]Now here is the clincher…[/B]

The house buyer can sell his house at any time.
The house [U]is his property[/U] until sold.
If he sells it at the right time, he can make a profit.
He has exchanged his house for money and [U]the money is his[/U].
There is no gambling in that - it is an astute business deal.

What about the trader?
His Yen (or other currency) [U]are his property[/U] until disposed of.
Well, now he exchanges the currency back.
If he does it at the right time, he can make a profit.
He has exchanged the currency for another and the money is [U]still [/U]his.

There is no gambling in that - it is an astute business deal. :smiley:

Now lets look at gambling…

I will disagree with [B]Phoenix, Honorary FX Member[/B], but for the sake of solving the issue, lets take your dictionary description…:slight_smile:

In gambling, your money (or other valuable) is staked…
What does that mean?

It means that it is put in a “pile” and at that point [U]it is no longer yours!![/U] :eek:

[B]Do you see the difference?!![/B]

[U]Lets take an example - lottery ticket.[/U]
Your purchase money had value but does the ticket have value?
NO - it is just a receipt.
If the lottery is the local CWA (cackling womens association), selling a box of lammingtons, you ticket is hardly any good for purchase of goods at your local camera shop!!

[U]Another example - poker.[/U]
Your bet goes into a pile.
From that moment on, the money is no longer yours.
You agree to forfeit it until the outcome.

[U]Another example - pokies.[/U]
Your coins go into the slot machine.
You cannot retrieve them - they are no longer yours.
You wait for the outcome.

[U]You can think of more examples.[/U] :slight_smile:

102

[B]The difference is that in gambling, you forfeit your money (or valuables) at the time you make an entry into the transaction.
Before the transaction, you had something.
After the transaction, you have nothing. :eek:
Unless the gambling outcome is in your favour (you win) you stay with nothing. :eek:
(Effectively a loss).

Now in the forex market, you do not forfeit anything when you make an entry into the transaction. :slight_smile:
Instead, you valuables are exchanged from one kind into another.
But you still own the valuables.

When you exchange back, you do not forfeit anything either. :slight_smile:
Your valuables are exchanged back to their original kind.
If you are astute about it (like the house purchaser/seller), you will make a profit.

The time factor in the exchange is irrelevant.[/B]

[B]So to finish with, this fundamental difference makes me think forex is not gambling.[/B]

103

i absolutely agree witht that. i told them the same thing before that in business you buy something of real value whether its currency or gold or oil in electronic form on internet business (can be done in real as well if you want to see physical delivery of goods or money) while in gambling you don’t buy anything of value . you just put your stake either in roulette or on horses or in poker.

thats the simplest and easist difference. hope people understand now

104

I am sorry Tymen but your house example does not work either. I assert that to the fact that you don’t live in the US otherwise you would know people gambled buying houses for profit for many years, with money they never had, until the “bubble” burst and now there are many City’s in the US faced with “tent towns” for real.

There house, or houses, where gone for the simple reason they actually never had there houses really paid with there money and then the banks they borrowed the money from took it away because the real owner was actually the bank.
Again, this is gambling. Of course they are calling it miss speculation, just a other word for gambling.
A very long time ago I went to one of the free courses for adult education (here in the US) and the teacher said very clearly:
Make no mistake when you buy a house it is your house and you have to take care of it.
I told here that the house is not mine if I have a mortgage on it and that it belongs to the bank.
She very empathetic denied that, petty I don’t know here name anymore, otherwise I would call here up and ask if she still is in “here” house.
Forex:
Actually even worse, we not only borrow the other currency, we actually leverage with 50:1 or 100:1 or more if the broker would let us.
I actually expected you would remember the “old days” :), where the broker would give you a nice call and ask for more money since the money in your account" evaporated" over the weekend (with luck) some unlucky people where millionaires in the morning and broke in the evening.
I downloaded a movie (legal by the way)
and wish you would download the different episodes. It is about the brokers when they still where trading in the pits.
This guys where Pro’s for big money and I think it will clearly stand out if forex is a important service or gambling.
The 2 last one (extras) are not needed to download I only uploaded them for the sake of uploading all that was to download.

Episode1 MEGAUPLOAD - The leading online storage and file delivery service 37MB
episode2 MEGAUPLOAD - The leading online storage and file delivery service 30MB
Episode3 MEGAUPLOAD - The leading online storage and file delivery service 43MB
Episode4 MEGAUPLOAD - The leading online storage and file delivery service 40MB
Episode5 MEGAUPLOAD - The leading online storage and file delivery service 41MB
Episode6 MEGAUPLOAD - The leading online storage and file delivery service 47MB
Episode7 MEGAUPLOAD - The leading online storage and file delivery service 38MB
episode8 MEGAUPLOAD - The leading online storage and file delivery service 35MB

Extra1 MEGAUPLOAD - The leading online storage and file delivery service 10MB
Extra2 MEGAUPLOAD - The leading online storage and file delivery service 10MB

BTW The few times I came into your life demo on BBDNA chat, I enjoyed hearing your lectures and enjoyed your voice since I have been in Aussie land a few times.
Despite our differences I would hope I can call you a friend, even tough, I am a M1 scalper.:smiley:

105

These types of arguments simply dont hold water.

If buy a lottery ticket for $1 on monday, and the draw for the lottery takes place the following saturday, there’s absolutely no reason why I should not offer that ticket for sale elsewhere.

I can sell it at a loss for 90 cents, or 50 cents or 25 cents. It makes perfect sense for another lottery player to purchase that card at a discount. In some circumstances, I might even be able to sell the ticket for a profit, if I’m able to find a purchaser who cant be bothered to drive to the shop, find parking, and queue etc. I may be able to sell that ticket for $1.25, $1.50 or even $2

So, I had money, I exchanged it for an item of value (a lotery ticket whose market vaue is $1), and there’s no good reason why I should not exchange that ticket before the draw. The liquidity in lottery tickets may not be high, but there’s a market. [B]Your argument that you forfeit your money does not hold water.[/B]

You can apply the same argument to a slot machine. You entered your dollar, and there’s no reason why you couldnt sell the ability to play to another gambler. At a push, you could sell a poker hand (it may be frowned upon, or even against house rules at a physical casino, but its potentially possible, although I grant you, unlikely, but there’s no good reason why someone could not develop a technical solution for the sale or exchage of poker hands in real time !)

Furthermore, you talk as if unwinding a position is instant. Maybe in a micro account gambling with your bookmaker it is, unwinding a large position in the interbank market is not always that easy.

You talk about a house purchase. The same rules apply. There’s limited liquidity in the housing market, its a lot easier to sell your $1 unused lottery cards than a $500,000 property. My parents have just waited over 3 years to sell a property, despite offering the property at a price well below its value.

You talk about exchanging goods, at a camera shop. I’m sure I probably could walk into my local camera shop, and negotiate the purchase of goods against the deeds to a property that I owned, but such a deal would need to be extremely favourable to the shop owner. He’s hardly likely to hand over say $100,000 dollars worth of equiment in exchange for 10% of my properties value, or hand over $100,000 in equipment, and $900,000 in cash, unless he particularly wanted to buy my house and the deal offered was more favourable than a stright cash purchase at market rates.

The camera shop owner is just as likely to do a deal on $10,000 worth of unused lottery cards as he is on $10,000 worth of gold. Now clearly he’ll factor in the fact that there’s possibly an expiry date on the lottery cards, and any cards he’s left holding after the date will be worthless, and he’ll adjust his offer accordingly.

I’m sorry, but trading is gambling, and you’ll need to come to terms with that

106

Thank you for a comprehensive answer.

It is very late here and I have my head in some computer programming.

I do not have time to reply just now.
I will give it some thought and reply later. :slight_smile:

107

Richard Dawkins is one of my heroes!

108

i have a suggestion for you tymen. these people will never understand and not gonna accept forex is not gambling. those who are wise have understood already. i think you should leave them alone. whats the point of wasting time if somebody is not willing to accept the fact.also you don’t need to convince anybody, why would you??.