The Difference Between Forex and Gambling (part 1)
Reposted from Currency Secrets
Last week I took a trip to Melbourne with friends to watch U2 play live in concert. While the concert was something that I’ll never forget, but one odd memorable moment of the weekend was spent in the Crown Casino. After wandering through the casino and seeing the multitudes of pokie machines and playing tables we sat down for a coffee. As the conversation talked about our immediate surroundings it soon turned to what I did. “Ryan, you say that forex trading is different from gambling, how so?” “Well let’s have a look,” I answered, “and compare both.” We looked out at the old ladies pushing the flashing buttons and began. “We both need money to play, right?” One friend nodded. “We both have an element of risk. For a forex trader this can either be their stop loss for each trade or their entire account. For the pokie player whatever they put in they are prepared to lose.” “Yep,” they all agreed. “We both have an uncertain element of reward. Even if a forex trader uses limit exits they don’t know whether that will ever be hit. Same for the gambler.” “Mm-hmm.” “Not even having a system differentiates between both: I’ve seen systems sold by people to make money from Lotto, or on the tables, or horses.” “So you’re a gambler then?” they all asked. “Well there is one thing that differentiates us.” “What’s that?” I knew they wouldn’t understand the terminology I was going to use as the answer so I used a simple illustration. “Let’s say that I find a game at the Crown that allows me to make $1 if I can call the flip correctly, but I’ll lose $1 if I call it incorrectly.” I stopped making sure they understood - they did.
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