Booms, Busts, and Recoveries Message Board

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Strategies & Market Trends : Booms, Busts, and Recoveries

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To: Moominoid who wrote (25254)	11/12/2002 1:42:46 PM
From: pezz	Read Replies (1) of 74559

<<I like to have the expected value of the gain in my favor - which it is in investment - rather than against me which it is in gambling. >> Himm....So if you go to the track and put $2 on the fav to win $1 that's investing? You mean that YOU think the expected gain is in your favor.Truth is at the current price there are an equal number of people who think it's goin higher as who think it's goin lower. It's all about odds and beating them. It is gambling .This is not to say we don't have consistently successful and unsuccessful gamblers. I on occasion buy a stock that I think the odds of decline are probably higher than advance.But I believe the percentage gain if it does go up justify the risk. Thus if I buy 10 and win 3 I come out ahead.Of course if my assessment of the odds of winning as 3 in 10 are wrong and in reality they are 1 in 10 I lose. Whether we admit it or not it's the accurate assessing the odds and placing our bets when we believe the odds as quoted (price) are incorrect is what we try to do.

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