Honest question has the stock market become a casino?

šŸ“Š Investing
1

With the recent activity and all of the interest in Penny stocks that go :rocket: to the so called moon :full_moon_with_face: I have started asking myself if the market has become a casino? I am just curious if it is just me or anyone else feel the same way

Stock market or Casino
    • yes some of the activity in the stock market is starting to look like a casino (:rocket:)
    • nothing special same old same old, there is always a bubble somewhere
    • we are in a bubble (:chart_with_downwards_trend::man_facepalming:) but there is still money to be made
    • I own Dogecoin and I donā€™t care :money_mouth_face: and plan to buy a Tesla with it next year
    • to crazy for me, I now have more cash that stock in my account

0 voters

2

For me personally I think it is not a casino. In a casino everyone plays by the same rulesā€¦

Joking aside, the recent GME stuff at least had some solid financial/technical explanation. It didnā€™t happen out of pure chance or due to pure pumping. In my mind that context keeps the current market environment out of casino land.

The real question in my eyes, have people started treating the stock market like a casino? For me the answer is unquestionably yes, but an interesting conversation for sure.

3 Likes
3

I think itā€™s just the influxā€™s of new retail investors that has been fuelled by people with more time on their hands due to the pandemic, I think that things may start to level off a bit more when we start opening our countries up, every one want to own the next Tesla or Amazon so thatā€™s the appeal with low value stocks, people should still do their DD with them because not all will make it through the next year or so, I think the times are changing where markets reacted to bad and good new like before, we all know that long term thereā€™s a chance of the stock markets recovering after a dip, the fear has gone so any type of major sell off of stocks is for now going to be less likely, even more so with retail investor who are all individual thinking vs the old system of the past where big money men controlled the market movements

4 Likes
4

Itā€™s disappointing that there are so many people acting like :clown_face: with bottomless debt-funded pockets, that get caught messing about and then raise a fuss because they now canā€™t afford to repay the loan they took out against their house to finance their ā€˜genius planā€™ of GME :rocket:2D :full_moon_with_face:

The people who accuse the brokers of robbing them, are very likely the same people who have no clue what the term ā€œthe house always winsā€ actually means in regards to casinoā€™s. :man_shrugging: certainly comparable to a casino, but instead of a bouncer kicking your butt for cheating, itā€™s the police/debt collector knocking on your door.

the latest rounds of changes to the platform have thankfully benefitted those of us who take this seriously the most.

5

Fully agree with this. I started this conversation as I hear the word casino about 20 times in an interview on Bloomberg. I was just curious to see what other think.

I have no idea who in their right mind would take an load on their house to bet on the marketā€¦ but these are probably the same people that would in normal circumstances bet on sports or on a horse. It is just that, they have not realised the stock market is not the same thing. I donā€™t understand why someone that did not have a broker last week would think it is a good idea to buy options /CFDs this week.

6

Whatā€™s scary is that with every bubble or pump and dump, a story comes out in the media where someone has really mortgaged their home to fund the risky position only to lose everything and have no clue how to repay the debt. The risk just isnā€™t worth it imo.

7

There is definitely a casino element. With all these new digital brokers in the market, anyone with some spare cash can give it a goā€¦and as i am sure everyone is aware, it is tempting to do day trade, which is where i see the casino interpretation. obviously there are day traders that know what they are doing, but i am sure if we were to look at the data, we would see a massive rise on day traders over the last year, which creates the casino impression.

2 Likes
8

There was an article about how the number of options day traders shot up in the US during the lock downs. At least the invest account wonā€™t let you short :sweat_smile: hopefully things calm down once only the serious stick around a year or so from now.

1 Like
9

I hope so. But it might be that the genie is out and might not want to go back in :man_shrugging: Although I do hope things calm down a bit so we donā€™t have so much strange volatility (although lately it has been profitable and I should not complain).

I donā€™t think people should buy things they donā€™t understand but I do appreciate the video :rofl::rofl::rofl:

2 Likes
10

Always has beenā€¦ Wall St ran things for a long time manipulating the tape the media, we just found out how to use the controller.

11

It does seem like thereā€™s a fine line between investing and straight-up gambling sometimes, especially with all the hype around meme stocks like GME. I think comparing the stock market to a casino isnā€™t entirely off base. Both involve risk, adrenaline, and the potential for big wins or big losses. But what sets them apart, in my opinion, is the level of knowledge and strategy involved. Sure, there are folks out there treating it like a casino, throwing caution to the wind and hoping for the best.

14

Youā€™re definitely not alone in feeling this way! The stock market has always had an element of unpredictability, but recent trends have amplified that casino-like vibe. Itā€™s fascinating and a bit unsettling to watch how accessible trading platforms and social media hype have transformed the trading landscape.

On one hand, the marketā€™s inherent unpredictability hasnā€™t changed. Stocks have always been subject to sudden rises and falls due to many factors, from company performance to global events. However, in my humble opinion, whatā€™s different now is the sheer number of people who can trade at the click of a button, many of whom might not have a deep understanding of the market. Itā€™s like putting a roulette wheel in everyoneā€™s living room.

The surge in popularity of platforms like T212, eToro, Robinhood, etc., coupled with the social media buzz around stocks ā€œgoing to the moon,ā€ has led to many novice traders treating the market like a high-stakes game. Instead of basing decisions on fundamentals or long-term potential, thereā€™s a focus on quick gains and hot tips. Itā€™s a shift from investing to gambling, driven by the allure of quick riches and the fear of missing out. However, I remember a similar vibe over 20 years ago during the dot-com bubble, in which I lost some money too (shame on mešŸ˜‰).

Moreover, the concept of ā€œmeme stocksā€ has added another layer to this phenomenon. These types of stocks soared not because of their financial health but because of collective action by retail traders driven by social media narratives. This collective buying can create massive price swings, rewarding some but leaving others with significant losses, much like a casino.

So yes, while the market itself hasnā€™t changed in its fundamental unpredictability, the way people engage with it has undoubtedly taken on a more speculative and, dare I say, casino-like nature. Itā€™s a double-edged sword: more people can grow their wealth through investing, but the line between investing and gambling has blurred, raising the stakes for everyone involved.

In the end, new traders must educate themselves and understand the risks. Treating the market with the same caution and strategy as you would any serious investment can help mitigate the ā€œcasinoā€ feel and promote more sustainable trading practices.