The Stock Market vs. Sports betting, be unemotional in decision making
By Soko Directory Team / August 31, 2017
By Revuka Capital
It doesn’t matter how many years you have traded in the stock market, how many affiliated degrees or certificates you hold, how excellent an analyst you are – the stock market is and will always be somewhat of a gamble.
How different is this from actual gambling? Well for one, ask yourself what picture comes to your mind when I mention gambler. You’re probably picturing a man in his 50s or 60s with worn out clothes on a slot machine, holding a cheap strong drink – a loser, someone you would hardly want to associate with.
On the other hand if I mentioned a stock broker – you probably think of a 30-something year old in a sharp sleek suit, stepping out of his jaguar with a hot number on his arm.
What does the real picture look like? Well for one, a stockbroker – is a broker, he doesn’t call the shots he trades on behalf of large institutional funds – he negotiates the trade between buyers and sellers.
He’s the middle man.
The gambler does call the shots, but unfortunately, the brilliant statisticians behind slot machines, lotto’s and casinos have designed these businesses on one precept – the house always wins. Which means the gambler will eventually always lose.
Does this argument hold for sports betting? Let’s compare the two.
With stocks, you need to be a smart gambler, there are key things you need to look out for before placing your bet on a company.
What are the key factors driving growth of that industry?
What are the key factors that are driving growth for that particular company?
Is the management team good at execution?
There are other points that need to be considered such as political stability, governance surrounding the industry, investor demand among others. Chances are, if you get the top three right and the company is about to go into a growth spurt the stock will go up and you will make a good return on your money. But even if you get the top three right, there is no guarantee you will win.
So let’s compare this with Sports betting
To be a smart sports gambler these are the key things you need to look out for:
How successful has the team been in the past vs. the team they’re playing?
What players are on the field?
Is it a home or away match?
You also need to consider other factors such as coach ability, key player injuries as well as other factors. How much you win is dependent upon other betters behavior.
In both cases the investor/gambler needs to be unemotional in their decision making – a hard feat for a die-hard fan affiliated to a particular team. The secret is to get your facts right, have a smart analytical mind, get it wrong a couple of times so you can learn what not to do next time and finally, keeping your fingers crossed.
Revuka Capital acts as a bridge between investors and investment opportunities in the East African region. Revuka specializes in market research, investment tours as well as advisory services pertaining to investing in the region. [email protected]