Thread by @TheBubbleBubble

I believe we're at "peak trading," right before the game basically shuts down.

The irony is that there is a tremendous surge of interest in trading.

I've never seen so many new "traders" (gamblers, really) in my life. The community has exploded.

https://twitter.com/TheBubbleBubble/status/1357379023475789825?s=20

The overwhelming majority of new "traders" or "investors" in crypto or stocks are actually gamblers, they just don't realize it.

Just because you are trading financial assets instead of playing slot machines or card games, it doesn't mean that you're not gambling.

So you are trading financial assets instead of betting on horses or card games, which allows you to pat yourself on your back and feel sophisticated and say "I'm not a gambler; I'm an investor!"

But, for most new traders I'm seeing, their approach is no different than gambling.

These young trader "bros" are getting caught up in the hype and they're just piling into whatever asset is soaring that day thanks to the Fed - "Look, Mom - I'm an investor!"

My advice is to skip the Reddit boards and do your homework first, starting with this classic book:

What determines whether you are gambling or investing is not the asset that you are buying; it's about the approach:

- Is it business-like?
- Do you have a sufficient margin of safety?
- Is the asset overvalued & overhyped?

By the way, there is nothing inherently or morally wrong with speculating or gambling.

You just have to be honest with yourself and not tell yourself that you are investing when you are really gambling. It's important to make that distinction.

Here's some relevant demographic data about today's new crop of traders. They skew young and male - hence "trader bros."

Also, the majority have never lived through a sustained bear market (early-2020 doesn't count and many started trading after that.)

https://twitter.com/business/status/1357111899847073795