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Stock/Option "trading", I mean, gambling

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Re: Stock/Option "trading", I mean, gambling

Postby daermo » Thu Jan 26, 2017 9:26 am

Just read all the posts in this thread - and if you are a stock addict (options/forex/spreadbetting you name it) - you should read this thread.

What we have here is many people thinking they can beat the market and make a living doing it. And many people with a gambling addiction that soon takes over and wipes us out.

I know one guy asked if there was a way to still trade and beat the gambling addiction. I ask this same question - and Im not sure myself. After reading all these stories Im not even sure its possible to make money in the market at least the kind I would find useful. Like many here Ive spent so much time studying the market and reading etc etc that would feel like such a waste and let down to have lost the time and money.

I see so much of me in this thread its not funny; almost thought it is me in another life that posted here in many of these posts.

The last quote from genex said this "I will never not recover my massive losses, and neither will you. But twenty years from now you could look back at today as the day you stop hurting your family (like I have hurt mine)."

like many here I used to consider myself superior to casino gamblers but we are the same - the complexity of the market hides its true nature for the addict - a means to lose control and hurt our soul with the guise of solving a problem (figuring it out).

I read a few posts about how some people had looked liked they quit in their mind but years later did the same thing again (can relate).

regretfully we all need to make money in life to live - some of us have jobs we hate or jobs that dont make enough or even no jobs at all, and some of us have an income that brings in so little compared to what we have lost to pay back this loss is almost mind boggeling ...

One of the things I have been thinking about more and more is that we cannot control the world and we cannot control our emotions - we can only control our actions.
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Re: Stock/Option "trading", I mean, gambling

Postby NewSunRising » Thu Jan 26, 2017 2:10 pm

Hi Daermo ,

This is a good thread , and certainly relevant . But for the sake of continuity , it's better to link to very old threads in your posts instead of bumping them . It just makes for a tidier forum . :D
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Re: Stock/Option "trading", I mean, gambling

Postby tbone3443 » Fri Feb 24, 2017 4:36 am

Thanks Daermo for your excellent post. My guess is we have a lot of the same experiences. I am the original poster on this thread in 2013. It has been years since I have posted anything in this forum. I think it is because I thought I had the problem kicked. But no it is/was not, nor do I think as of today that my addiction will ever be “kicked”, and I felt the need to write something today for myself, and hopefully also to help others. The good news is that as of today, my net worth is a few hundred thousand dollars, so I am not in a horrible situation, and this is primarily because the business I have (not trading related) is doing well. Also, probably half of that net worth is from an “investment” in bitcoin in 2013, which I should note, I have never traded even once. I have just bought bitcoin, not sold, as it has gone up 100+ fold, and that is the one thing I feel like I can be proud of in terms of what I have done with my savings. The bad news is that I started option trading again, after my initial post in 2013, in about 2015, and have many serious negative consequences because of that, not just financial ones Ironically, the WORST thing that happened to me was that I made about $10K trading options in 2015. Why? It gave me trading confidence again after the destruction in my confidence from the previous 20 years of losses. I once again thought I was smarter than everyone else, and knew the market well enough to “beat the market” over the long term. I thought I was never going to lose again! I had it all planned out in a spreadsheet. Just a 5% return per month and I could retire in 5 years-no problem! So, I plowed more and more of my savings into my option account and took on more and more risk. My strategies seemed to change with the wind, from mimicking a long term contrarian strategist (I never had the patience to hold on to my positions with this method, as there wasn’t enough “action/trading” to get the high I needed) to getting a membership with a short term trading guru, which was a disaster as well. In 2016, I lost about $50K, and I have lost over $10K already in 2017. I guess I am writing today because I think I had my final blowout today, and realized that if I continue with this path I will likely go through all of my money, eventually. The blowout happened because I was so sure that a stock was going up after its earnings report tonight, I bought March options last week, and as of now, it looks like the stock will open up 10% lower tomorrow and my options will be worthless Check out $ACIA, and you will see what I am talking about. Im sure I will lose all or most of the $5K or so on the 60 call options I bought.

The money that I have lost is painful, but not nearly as painful as to what has happened inside me. The feeling of complete lack of self worth has been almost continuous this past year or so, interrupted by blasts of invincibility during the times I am in a winning position. The agitation, and anxiety I feel during trading hours, and the feeling of impatience and agitation during non trading hours, is painful. I cant wait to get to 9:30 EST for the options markets to open to get a change of emotional state. And although I have never taken cocaine, hitting the buy or sell button is probably not much different than what I have been experiencing trading. I often have difficulty sleeping Sunday through Thursday nights, and I often find myself checking futures markets in the middle of the night. I find myself drinking wine often at night to relax and to make time go faster so I can get to 9:30AM more quickly, so I have the chance to trade again. Drinking also helps to numb the pain of losses. I wake up a lot of days on the weekend depressed, feeling that life is not worth it. It is all related to my self-worth and even though I do ok with my business, my self worth is tied to a much smaller part of my life-my success in trading, and that is sad. I have not told my wife I lost $60K this past year or so, and the feeling of hiding this grinds on me every day. She frankly didn’t know about the $10K I made in profit the year before either. She probably just thought they were normal capital gains from investing my extra money (I do our taxes so she doesn’t look into it too closely) I feel like, although I have never cheated on her, completely deceitful because of my trading and hiding my trading from her.

Im here to tell you, no matter how smart you are, that for 99% of you, you cannot beat the market, and for 99.9% of you, you cannot beat the market in any significant way. I went to very good colleges and have an MBA. I studied options in school and for 25 years in practice, and I get crushed in these markets nearly every year, because it is gambling, pure and simple, and I am a compulsive gambler. It has cost me, big time, in relationships, and I feel like I have lost half my life because of this addiction, as I feel like I have been in the compulsive trading zone as a zombie for half of the last 25 years. I feel like I don’t have children because of my trading. Why? Because in my 20’s and half my 30’s I never had any extra money not in the markets, and therefore I never had the confidence to go after the women I really wanted, because the woman I wanted would expect me to have a decent amount of money given my background. And although I think I have a good marriage, by the time I did get married to someone who was about my age, it was too late to have children, and for that I will never be able to forgive myself. DON’T let something like this happen to you. Yes, I have a little money today, but it is so dreadfully painful knowing that if, after college, I had simply taken 10% of my income and put it in a stock mutual fund every paycheck, I would be a retired multi-millionaire today at a relatively young age.

First thing tomorrow, I have promised myself to take all available funds in my brokerage account and put them into a treasury bond fund, and cancel my options account. All future funds will be going into diversified mutual funds. There is no way I can survive trading any more, it has worn too much on me for 25 years. Even trying to trade, or frankly even long term invest in any specific stock, I know will just lead me down the same path of taking bigger and bigger risks. Just making the plan to do this tomorrow is putting me at ease. My normal nightly anxiety before a trading day is completely gone now, and I feel like a new man. In all honesty, I have done this before, but I really feel like this is the last time. Wish me luck, and strength to see this through. I cannot live the next 25 years, like I have lived the last 25 years. Like Daermo said, I have to control my actions, today, tomorrow, and forever. I so badly want to look at this day, 20 years from now, as the day I stopped hurting myself and my family. Gambling problems do not get completely shut off-ever, IMO. I plead with anyone here who is reading, to do everything you can to not get involved in this game, especially without question, if you have the habits of a compulsive gambler, like I do. Just making the plan to do this tomorrow is putting me at ease.
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Re: Stock/Option "trading", I mean, gambling

Postby Flanksy » Fri Feb 24, 2017 12:38 pm

tbone3443 wrote: I cannot live the next 25 years, like I have lived the last 25 years.


Thank you so much for this post.

You almost made me cry , this is exactly what it needed to see.
As a 20 year old currency/option addict I feel like I can beat the market sometimes, but the long term is always blurry.

This testimony is so powerful. I to realize I am throwing away my life by checking the markets, not sleeping and feeling anxious 24/7 when in a position. I have not checked the markets for a while now and it feels good. I had a lecture last week at university in which the professor stated that markets only have to be open 1 day each month for accurate price forming to occur. The whole financial system is just one big mess where people trade every millisecond to gain an edge on others.

Even from an ethical and moral point of view it feels bad to gain money at the expense of others, we add no value to society by trading and it only benefits ourselves.

I hope you find peace with the past you and start focusing on the present you. Know that this post helps me and probably countless others a hard earned insight in how soul sucking and pointless this form of trading is.

Take care tbone3443, I will save this post and re-read it from time to time to have a reality check with how I don't want to end up. (no offense) Focus on the present you and start living life.
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Re: Stock/Option "trading", I mean, gambling

Postby tbone3443 » Fri Feb 24, 2017 6:11 pm

Thank you so much for your response Flansky. I appreciate the kind words and I hope it helps you and others, as it helps me by simply writing it down in this forum.

Wall Street does have an important purpose in bundling peoples savings and getting those savings to investors to expand businesses. But I think so much of the effort in this industry is in trying to get an edge over others, and not creating any value, as you mentioned. How many brilliant minds are in hedge funds today trying to beat the market by a 10 percentage points so they can garner a multi-million dollar paycheck? Most of them, no matter how brilliant they are, cant beat the market on a long term basis. Think if those minds went into engineering or medicine what they could do. Im all for a free market, but there is entirely too much effort going on in speculating on asset prices, which takes away from producing real things. This includes me. I could have created so much more value in my life/in my business/in my relationships if I was not looking at stock quotes and agonizing over them every trading day. You are right, it is soul sucking and pointless. I used to think, well, if I just made a lot of money speculating in options, I could do good with that extra money, and that was how I justified it. But the reality is I would create no net new value, because even if I say made $1 million or $10 million in options trading, it would just have come from other speculators losing money, who may have done something good with that money as well. Would it make me a better person even if I had won $10 million? Would I really have done good with that kind of money? I don’t know, but I do know I would not be able to stop at $10 million, and would have all the same pain inside me every day, and Im sure I would eventually lose that $10 million in a blowout trade and become massively depressed.

Today has been a pretty good day for me. I consider it Day One of my recovery. The $ACIA options I had ended up still retaining some value today even after the stock plunged on the open, and I was able to recover about $1K out of the $5K I put in. I think I will try to do good with that money, as this $1K of money I didn’t expect is symbolic. Maybe I will start up a college fund for a nephew with this $1K, or just give it to charity.
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Re: Stock/Option "trading", I mean, gambling

Postby getting_better » Tue Feb 28, 2017 6:21 pm

tbone3443 wrote: Wish me luck, and strength to see this through. I cannot live the next 25 years, like I have lived the last 25 years. Like Daermo said, I have to control my actions, today, tomorrow, and forever.


Thank you for the great thread and the great post tbone3443.
You are right - our actions are the only thing we can really control in this world so stick to this idea with all you got.
I wish you all the good luck and strength in the world.
Connection is the opposite of addiction
https://www.youtube.com/watch?v=C8AHODc6phg

Today gamble free I stay!
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Re: Stock/Option "trading", I mean, gambling

Postby tbone3443 » Wed Mar 01, 2017 5:25 am

Thank you getting_better, I appreciate the words of encouragement. We dont know each other, nor does anyone on this site know each other, but it helps to hear from people who have had similar experiences and who understand the pain. I feel so much better not trading just after one week, and all the money I have is in a bank account or in treasuries. I can once again focus on my real life-my job, family, and other relationships, and not a in a false reality looking at stock quotes most of the day.
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Re: Stock/Option "trading", I mean, gambling

Postby prologx » Tue Mar 07, 2017 3:32 pm

Options are one of the worst gambles you can make with your money. I'm sure we all know how much options out there that are expired worthless. My work is closely related, and I never want touch it with a 10 foot pole. Another bad bet is short term trades leading into earnings, expecting you will make a quick buck. There are so many variables first off the company must beat analyst expectations on all Metrics, next they have to have a decent guidance. Even after all that is met, some huge hedge fund can decide to take profits off the table sending the stock down, and spooking other traders for a domino effect. I lost thousands doing this, the only thing that saved me was my long term holdings that I decided to exercise.

Best thing to do is find a few index funds that well diversified with long track records put it at a set interval ( monthly) , and forget about.
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Re: Stock/Option "trading", I mean, gambling

Postby tbone3443 » Tue Mar 07, 2017 4:19 pm

Thanks prologx, that is good advice. On some level I, and I would say probably many others, know options are a bad gamble and buying options before earnings are wild speculation. But that is exactly what lures compulsive gamblers like me into making these types of trades-the opportunity for big profit in a short amount of time, even if there is a chance of a bad outcome. Its not much different than putting your money on black or red, its more about getting the action and thrill of trading. Index funds are exactly what most people should be doing, but what often happens is that compulsive gamblers like me start with index funds, find them boring and not volatile enough, and then move on to riskier things like individual stocks, then options, then options before earnings reports, etc, so we can get the quick high of gambling.
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Re: Stock/Option "trading", I mean, gambling

Postby Fund Manager » Wed Mar 08, 2017 2:25 am

prologx wrote:Options are one of the worst gambles you can make with your money.


+1

Learned my lesson about 15 years ago when I blew $20,000 on a naked call option.

Soon thereafter I voluntarily surrendered my derivatives license and permanently closed my leverage account. I also ceased all option trading---even covered options---on behalf of my clients.

tbone3443 wrote:Index funds are exactly what most people should be doing.


+1

Non-gamblers are happy to earn +6% per year on their money 90% of the time.

Gambling addicts are not satisfied unless they can earn +90% or more, even when the long-term probability is 6% or less.
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