Is there a hard threshold? Do high risk investments such as penny stocks qualify as gambling? Do low risk investments? Annuities? Bonds? CDs?

This comment got me wondering.

Is it more to do with the venue? Stock markets and real estate vs casinos and the lottery?

Were the MIT Blackjack Team gambling or investing?

Or Jerry and Marge Selbee?

Is this just another semantic hotdogs are sandwiches discussion or is there an agreed threshold?

  • bss03@infosec.pub
    102·
    4 months ago

    IMO: When you do it for the entertainment/feeling/rush, it’s gambling. When you do it for the returns, it is investing. I also think the other poster that mentioned investing as being interested in the success of the endeavor, that would exclude shorting and I think might be a useful distinction.

    Casino games and sports betting all have lower expected value (probabilistic value) than their cost, so they are not something you can do for returns (you have better expected returns by not participating).

    There are plenty of people that are misinformed, dishonest, or stuck finding a bigger fool that will sell you a gamble by calling it an investment, and expected value is not guaranteed value.