Stock Market vs Online Gambling ?

The growth of startups such as Zerodha, and Groww indicates that the new generation, who are entering the working class tend to look at the stock market as a lucrative investment option. However, there has been long-standing comparison between the stock market, and onine gambling due to certain similarities.

Both the stock market, and gambling put capital at risk. The main objective of both is to minimize risk while maximizing profit. They assure the party involved of good returns. The investor or trader initiates a trade on a stock based on historical data, and current trends, which is similar to how a player in online gambling places a bet on a sports player or an event where the outcome is uncertain. In gambling, the house always wins i.e., the organizer always makes a profit, which is analogous to a stock broker in the market.

With all these similarities being said, key differences still remain. The stock market is a regulated entity while gambling is not. In the stock market, the probability of a pattern of events occurring is higher based on technical analysis, unlike gambling where every event is independent. A long-term investor in most cases is bound to make good returns through regular dividends, and the potential economic growth of the country.

On analyzing, the similarities, and differences it is safe to conclude that investing in the stock market through mutual funds or through a diversified portfolio is a viable option to beat inflation. It should not be compared to online gambling which is based only on luck, and the odds are always against the player.