Being a gambling blog, and one written by someone who has profited from it for 5 years, it would be easy to think that Punt.com would be fully in favour of everyone gambling. Some would misconstrue the site as glamourizing gambling, even without reading the blog entries. Many would be quick to label it irresponsible.
The internet (and real life) has an abundance of people who have endured awful problems because of gambling. You only have to do a search on gambling problems to come across the numerous forums full of people in crippling debt.
I don't advocate people gambling.
Firstly let me say that this blog is and always has been intended as a notepad for my own thoughts on gambling, and a place where a community of gamblers, traders and those curious can come to read about or comment on the finer points of what we do. It is intentionally complicated at times, it deals with some fairly deep psychological ideas... These are issues professional gamblers deal with on a day to day basis and if anything, should describe the level of expertise required to make this pay.
During the time I've been writing this blog, I've referred a few friends to have a read. These are people that knew I gambled, but did not know the sorts of things I had to contend with. Their response has been the same each time - we had no idea it was such hard work, we thought you were a "lay about!" (Or words to that effect.) They thought I just watched sport and picked winners. Nothing is further from the truth.
What this is demonstrating is their lack of understanding of gambling. It's the same lack of knowledge that the general public suffers from, and one of a few reasons why we have problem gambling.
Clearly gambling is something I take very seriously, it's my job and my money on the line. But for the vast majority of people, gambling should be about light entertainment, with money they can afford to lose (spend), on something they enjoy watching. They aren't particularly worried about obtaining the knowledge needed to profit. Firstly because they don't really know it exists, secondly they think it's just a case of picking winners and lastly, they'd rather spend their time enjoying having a punt.
Not being qualified in psychology, I can't offer an expert view on the mechanics of gambling. But it's clear to me that there is something a little paradoxical going on when we mix money, games of chance and entertainment. Humans, it seems, struggle to deal with this in some basic way. Quote from wikipedia on gambling, "though many participate in gambling as a form of recreation or even as a means to gain an income, gambling, like any behavior which involves variation in brain chemistry, can become a psychologically addictive and harmful behavior in some people. Reinforcement phenomena may also make gamblers persist in gambling even after repeated losses."
Prior to striking a bet, the door to problem gambling wasn't open - and this is the way I believe it should be for most people. Even when they set out with the best of intentions to enjoy themselves, many will end up being hooked.
It's my opinion that people need to be armed with much more knowledge and understanding of gambling in general. It seems like there's a carefully nurtured void in our collective knowledge of the subject, perhaps those that profit from the addicted gamblers have done their best to surpress this.
When I was younger, my parents taught me about the dangers of gambling. It was not something they ever wanted to see me doing - a member of my family had had problems in the past, and they didn't want to see me go down the same path. It made me weary of gambling, and it made me want to understand why they developed a problem and to never develop one myself.
And yet here I am doing it as a job! Perhaps that is why it is my job. When I began gambling I was paranoid about the prospect of developing a problem. It was a bit scary, I made sure I never chased losses and I made equally sure that I never got the buzz of adrenaline from it. Gamblers out there are probably thinking - where's the fun in that ?!
Knowledge is power.
If you aren't a gambler but want to gamble, then I'm not going to stop you. I always tell people to not gamble if they haven't started and to stop if they have. Particularly when they don't appear to be very clued up. Before anyone gambles for entertainment or otherwise they need to know a few things:
- Why bookmakers make a profit.
- Why casinos make a profit.
- Gambling causes problems for people, it can be dangerous to do, even for those with the best of intentions.
- This is a mathematical game, if you know points one and two then you will also know the chances of you making a profit is close to zero!
- The chances of you losing your money is therefore close to 100%.
- If you are doing it for entertainment then spend time figuring out how you will feel once you have lost. Because quite simply, you will - make sure you are ok with that and make sure you won't want to make it back.
- Never bet more money than you can afford to lose.
- Probability, probability, probability. You can't beat it. The gambler's fallacy. Don't know about probability ? - Give up now.
- Never use gambling as an escape from real life problems. Some gambling games hypnotically affect people, they are designed to suck you in and make you forget reality. Never forget the bigger picture, know how much money you are betting.
- Some casinos pump oxygen round to keep the gambler's going for longer, slot machines make trance like patterns with their lights. Don't you think this is more than a little out of order?
- It is in bookmakers best interests to glamourise gambling. To make you think you can win and to push bad strategies subconcsiously onto you. Hardly surprising is it?
- People selling systems are almost guaranteed to be losers. Why would you sell a system when the rewards for using it would be so much higher. Also, a sold system becomes worthless because so many people use it and the bookmakers / markets change because of it - system no longer works.
If you think you are suffering from problem gambling then there are some links at the bottom of the page. Please do the right thing and follow them. Gambling is a dangerous sport, please be aware of the warnings that come attached to it, never let your guard down and always count the amount of money you are gambling and think what you might be spending that on instead. For the regular gamblers here, I make few apologies if this entry seems too preachy. It sometimes pains me how some knowledge that we take for granted, ends up causing so much greif, and on top of that - very few are telling people about it.
Nice article Matt, Before I started trading the fx market I figured myself as highly rational. I thought that being aware of risks of gambling addiction was a sufficient safe guard, but I was wrong, and I fell victim to a changed 'brain chemistry'.
But I have no regrets. Many important decisions in life are gambles, and I am glad to have worked through this experience, which has given me a deeper understanding of my own strengths and weaknesses when it comes to making risk-return decisions - a kind of enhanced self-awareness. It has come at a financial price, however, and if my downward spiral had continued, it would not have been a price worth paying.
Keep up the good work, and all the best on your trading and other exploits.
Posted by: Caravaggio | February 24, 2007 at 01:37 PM
I have the same amount of sympathy for problem gamblers as I would for anyone else showing a lack of common sense. To me that's simply what it is in the same way people get drawn into other addictions.
I don't really enjoy the misconceptions about gambling out there, but I'm more than happy for the majority to remain ignornat to how possible it really is to make a profit. Were everyone hammering the exchanges in the right way I'm sure my profit margin would decrease. Anyone applying some intelligence to a market of their choice will no doubt be able to make a long-term profit. I believe that success at gambling mirrors success in any other field: Those who are driven and obsessive will do well, those that are lazy and uninspiring won't.
Another factor is mental detachment. I don't need to bet every day, and I don't bet on anything "just for fun". Though I enjoy what I do very much when I take time off from gambling, which I make sure I do, I don't miss it in the sense that I feel I need to be doing it. I suspect it is the other way around for problem gamblers.
Posted by: TJ | February 24, 2007 at 04:42 PM