Let’s not argue whether or not trading is, by its very nature, gambling. Let’s save that for another day. Instead, let’s focus on the gambler who happens to trade:
1) The Gambler Trades Through Earnings Reports: If you decide to hold a stock/option position through earnings you are gambling. Due to the very nature of earnings reports your position could gap down or up. You are choosing to take a chance (e.g., gamble) on what that stock will do post earnings. Sure, you could get lucky and win big, but you could also lose big. The Crosshairs Trader chooses to trade into earnings and then follow the charts post earnings for the next trade. There will always be another trade on another day. Think before you trade.
2) The Gambler Trades Without A Plan: If you make your trading decisions based on the morning news, or on the latest CNBC story, or on a new strategy that you have not properly tested, or on a market that you have never traded, then you are gambling. The Crosshairs Trader has an army of stocks to trade, the weapons to use for that army, and a time tested military strategy in place before a trade is even considered.
3) The Gambler Goes ALL IN and Risks Losing It All: If you trade ALL IN as if your trade signal is 100% accurate and can’t be wrong, then you are a gambler. There is no sure thing in the stock market. There are just too many variables and too many traders who can and will disagree with your perfect signal. The Crosshairs Trader trades a small percentage of his account balance and believes in probabilities, not a sure thing.
There are too many other gambling techniques to mention in this post but these give you an idea of the type of thinking that does not belong in The Crosshairs Trader’s battle plan.
TRADING IS WAR. PREPARE YOUR WEAPONS.