Leverage trading is nothing but gambling

[jcojci]

Anything that goes beyond 10x leverage is gambling. I do even get surprised that there are those people who do get 100x or even that max 125x on which this is that pure gambling.

Honestly just the leverage number doesn't reflect the risk involved in a trade, you can be using 500x leverage and still pretty safe from massive liquidation if you just used $1 for your margin.
Many people did this, like using $2-3 when they have few grands in their account for future trade with 100x leverage, worst case scenario if they set proper TP/SL is that they trigerred their SL and probably in -200% ROI and lose $4 with $2 margin.

It's all about how you set up the trade.

If that person don't use analysis before he trade, he really gamble with his money so when he only use $1, his loss will be just $1 if he loss. But his profit will depend on the price he want to close his trade. If he close his trade when the price increase 2x from his buy order, that will be his profit.

Yes, I agree that will depend on how you set up the trade because as long as we can be careful to determine how much money we will use to trade using leverage, we will not loss too much. But that will be similar to gambling IF he doesn't analyze the market.

[KingsDen]

Why do you ops think and referred to trading as gambling, the two of them are widely different in practice and reality, while you lose both your profits and capital in gambling, trading on the other hand have more stability in their reality, stability in the sense that, some assets that are traded are my stable and less volatile and at that the traders tend to make profit or just wait for the price to recover,. Smart traders don't lose money, rather they could lose time, since when the trade goes against your prediction, all that you need to do is to wait sometimes before it recovers and you regain all your investment.

I doubt that you are a trader because you are taking Op out of context. If you read Op carefully, you will have to align with him or disagree with rationally.
First, you have to understand that Op is talking about a particular type of trading and not spot trading. Futures is more dangerous type of trading and could wipe your capital totally like gambling while in spot, if the trade goes against you, you can decide to become an emergency hodler till when the market will turn around.
So, leverage trading is very similar to gambling and not spot.

[Mame89]

Why do you ops think and referred to trading as gambling, the two of them are widely different in practice and reality, while you lose both your profits and capital in gambling, trading on the other hand have more stability in their reality, stability in the sense that, some assets that are traded are my stable and less volatile and at that the traders tend to make profit or just wait for the price to recover,. Smart traders don't lose money, rather they could lose time, since when the trade goes against your prediction, all that you need to do is to wait sometimes before it recovers and you regain all your investment.

I doubt that you are a trader because you are taking Op out of context. If you read Op carefully, you will have to align with him or disagree with rationally.
First, you have to understand that Op is talking about a particular type of trading and not spot trading. Futures is more dangerous type of trading and could wipe your capital totally like gambling while in spot, if the trade goes against you, you can decide to become an emergency hodler till when the market will turn around.
So, leverage trading is very similar to gambling and not spot.

I also see he doesn't understand what OP is talking about, Op is talking about leverage trading while he answered spot trading. Of course these two things are different, the risk of spot trading can be controlled, when the price goes down we can hold and wait for the price to recover or even higher. While leverage trading is completely out of our control when we miscalculate or predict then we experience losses. That is why many people highly recommend spot trading over leverage trading because the risk is indeed very high.

Gambling with leverage trading is indeed different but the risk is almost the same, because both can make money disappear instantly. In gambling we will involve luck and chance because it cannot be predicted. While leverage trading, although the risk is the same as gambling, but basically it is all about good analysis, strategy, and risk management. In other words, leverage trading we can analyze price movements and make decisions based on analysis, not just based on chances like gambling.

[Awaklara]

In other words, leverage trading we can analyze price movements and make decisions based on analysis, not just based on chances like gambling.

That's what traders who know the science of trading should do. Those who trade and gamble will know the difference. It's just that this is often equated by gamblers who are just starting out in futures trading. They trade based on speculation or the chances of possible price movements. So they open trading positions not based on analysis but on speculation alone. Which increases their risk even more when they use high leverage to gain greater profits.

[alastantiger]

I doubt that you are a trader because you are taking Op out of context. If you read Op carefully, you will have to align with him or disagree with rationally.
First, you have to understand that Op is talking about a particular type of trading and not spot trading. Futures is more dangerous type of trading and could wipe your capital totally like gambling while in spot, if the trade goes against you, you can decide to become an emergency hodler till when the market will turn around.
So, leverage trading is very similar to gambling and not spot.

You don't own the coins when trading with leverage hence the OP is right that leverage trading is just like how gambling works. Not many of us can survive leverage trading hence it isn't advisable that we start trading with leverage because we want to make more money. Those that succeed at trading with leverage are people that have perfected trading so well that they hardly make mistakes and people that also have enough money to throw around and they won't be scared of losing it because if you're the type that's always scared of losing money, leverage trading isn't for you. Anyone that's constantly trading knows leverage trading isn't somewhere to go and joke around because when  you do that before you realized, you're already up in losses that you mightn't be able to recover.

[hyudien]

In other words, leverage trading we can analyze price movements and make decisions based on analysis, not just based on chances like gambling.

That's what traders who know the science of trading should do. Those who trade and gamble will know the difference. It's just that this is often equated by gamblers who are just starting out in futures trading. They trade based on speculation or the chances of possible price movements. So they open trading positions not based on analysis but on speculation alone. Which increases their risk even more when they use high leverage to gain greater profits.

What Op said is true but not entirely true, what he meant was that trading with leverage can be gambling when traders take shortcuts which means not going through the learning process, reckless capital, then immediately jump into leveraged trading, then I agree that it is pure gambling.
But we can't say it's gambling if the person has gone through the learning process, understands trends, how to take positions and knows profit management. So the point is we have to first place where we are as traders? Have we gone through the learning process or not?

[Issa56]

My finding points to one truth about leverage trading in crypto trading and it is no difference with gambling since whatever position you hold when the market goes against your prediction you get your money liquidated, so tell me what difference it is with gambling where you also depend on luck the win.

Seriously future trading is not for the weak, if you don’t have proper knowledge about trading, then just avoid future trading, because I see no much difference between future trading, and gambling. Most people that do involve themselves in future trading is just because of the high reward thats in future trading, but there is also high chances of losing money also.

If you are trading future, then we are suppose to do it with just low leverage, and chances that you going to be losing money will definitely be low, but most people do take high risk, they do make use of high leverage, and if they are not lucky, they do end up losing. I don’t really encourage future trading, but anyone that’s prepared for the risk in it can definitely go into it.

[Asiska02]

Seriously future trading is not for the weak, if you don’t have proper knowledge about trading, then just avoid future trading, because I see no much difference between future trading, and gambling. Most people that do involve themselves in future trading is just because of the high reward thats in future trading, but there is also high chances of losing money also.

High rewards is what brings everyone to try something new even if it’s very risky and can make them lose a lot in it, this is how trading works and make people feel about it. I don’t see trading and gambling in the same category, they may both be risky but they’re are different and most likely won’t be in a position of comparing them. Trading works with 90% knowledge/strategy and when you find one that works for you, then you’re set on that path already. But in gambling it continues to be on luck and there is no guarantee the strategy you’re employing will win the bet for you even twice, so this is how big much of a difference I see them.

If you are trading future, then we are suppose to do it with just low leverage, and chances that you going to be losing money will definitely be low, but most people do take high risk, they do make use of high leverage, and if they are not lucky, they do end up losing. I don’t really encourage future trading, but anyone that’s prepared for the risk in it can definitely go into it.

Those coming into futures trading already should have a prepared mind to be okay with what the market is about to show them, which definitely is the worst part of the market. So taking higher risks in in the nature of every trader because of the saying that says no risk, no gain and the more you risk, the more likelihood you win big. Often times, traders also forget that the more you risk, is also the more you lose. Futures trading needs proper knowledge and when you’re not ready to have the knowledge and take the big risk in it, it’s better you don’t even try it.

[Odusko]

Why do you ops think and referred to trading as gambling, the two of them are widely different in practice and reality, while you lose both your profits and capital in gambling, trading on the other hand have more stability in their reality, stability in the sense that, some assets that are traded are my stable and less volatile and at that the traders tend to make profit or just wait for the price to recover,. Smart traders don't lose money, rather they could lose time, since when the trade goes against your prediction, all that you need to do is to wait sometimes before it recovers and you regain all your investment.

I doubt that you are a trader because you are taking Op out of context. If you read Op carefully, you will have to align with him or disagree with rationally.
First, you have to understand that Op is talking about a particular type of trading and not spot trading. Futures is more dangerous type of trading and could wipe your capital totally like gambling while in spot, if the trade goes against you, you can decide to become an emergency hodler till when the market will turn around.
So, leverage trading is very similar to gambling and not spot.

Well I won't blame you if you say that I take ops out of context, since I have to read the thread multiple times before finally getting a clear clue of what he might be saying, about trading, although in my comment above you can see that I outlined, all the categories of trading and explain both their risks and advantages over one another, so for sure you are not absolutely right to have said I did not understand the ops or you questioning my trading practices.

[doomloop]

In other words, leverage trading we can analyze price movements and make decisions based on analysis, not just based on chances like gambling.

That's what traders who know the science of trading should do. Those who trade and gamble will know the difference. It's just that this is often equated by gamblers who are just starting out in futures trading. They trade based on speculation or the chances of possible price movements. So they open trading positions not based on analysis but on speculation alone. Which increases their risk even more when they use high leverage to gain greater profits.

Not only leverage trading, but any sort of trading is gambling if you are making your trades on mere speculation or gut feelings, because trading is not done like that, it's not like gambling where you decide the bet, press a button, and see the results in front of you, in trading, you analyse the market, do enough research, and see past movements and other data to finally reach a conclusion about which direction the market will go next, and even if you are not always correct, if you are doing analysis the right way, you will at least be right most of the time.

Apart from that, there are risk-management techniques in trading that one can use to reduce the risks of losing a lot of money, but you can't have such things in gambling. If you know how to use stop-loss and take profit features in leverage trading, you will not be losing a lot of money even if the market goes against your prediction.

[skarais]

~~~

Not only leverage trading, but any sort of trading is gambling if you are making your trades on mere speculation or gut feelings, because trading is not done like that, it's not like gambling where you decide the bet, press a button, and see the results in front of you, in trading, you analyse the market, do enough research, and see past movements and other data to finally reach a conclusion about which direction the market will go next, and even if you are not always correct, if you are doing analysis the right way, you will at least be right most of the time.

Apart from that, there are risk-management techniques in trading that one can use to reduce the risks of losing a lot of money, but you can't have such things in gambling. If you know how to use stop-loss and take profit features in leverage trading, you will not be losing a lot of money even if the market goes against your prediction.

You are right, trading that starts with just relying on hunches or just relying on luck is like gambling. Real trading must start with analysis and sometimes it takes a long time before making a decision. But in many cases, the knowledge and experience gained during trading can also help traders to get started so that one day they can start trading without analysis when they see an opportunity in the market. This may sound bad and unreasonable, but an experienced trader can enter during a major correction even if they have not done any analysis beforehand.

Trading strategies are also important for a trader to master. The right strategy approach can help traders manage risk during trading, even trading without a strategy is also called gambling. However, there are some opinions that trading and gambling are not much different, both are almost the same, only there are some differences between the two.

[Dr.Bitcoin_Strange]

There are strategy for trading and if a good trader learns how to properly use those strategy, they can be profitable despite the losses they might face, but in gambling there's more of uncertainty compared to how it is in trading. There are most profitable traders compared to successful gamblers and that's because trading losses can be controlled while gambling losses can not be controlled. You know that in gambling, if you wager with $10k at once and you encounter bad luck, that money is gone but it is possible that while trading and you observed that your capital is going down due to price going against your direction, you can concede the lose and stop out.

[mich]

Well yes I do think if you leverage trade then you are gambling. I do think any way you trade with crypto is a gamble because it is so volatile.

But also it is a gamble I do think for us just to invest in crypto. Even if we do not trade it then we are still gambling just by hodling it.

[tottong]

My finding points to one truth about leverage trading in crypto trading and it is no difference with gambling since whatever position you hold when the market goes against your prediction you get your money liquidated, so tell me what difference it is with gambling where you also depend on luck the win.

It is a bit similar but there is a difference between trading and gambling especially for futures trading you can set lower leverage with a safer liquidation ratio.
Trading will look like gambling when someone opens an open position without having good knowledge so expecting luck in the trade is the same as gambling.
It is not wrong when people say both have similarities because the habits of people involved in trading are not much different from being involved in gambling.

That is a mistake in understanding trading and is generally influenced by the absence of knowledge to make comparisons based on facts.

[CageMabok]

It is a bit similar but there is a difference between trading and gambling especially for futures trading you can set lower leverage with a safer liquidation ratio.
Trading will look like gambling when someone opens an open position without having good knowledge so expecting luck in the trade is the same as gambling.
It is not wrong when people say both have similarities because the habits of people involved in trading are not much different from being involved in gambling.

That is a mistake in understanding trading and is generally influenced by the absence of knowledge to make comparisons based on facts.

Futures trading is only different in terms of risk because there it is similar to a contract that can be lost when the predictions we determine are wrong because they are opposite to the direction of the road that occurs in the market. And I also thought it was similar to gambling, but the difference itself still exists because trading is always in the market, not in a casino or the like. In addition, the level of profit that can be obtained by traders who make correct predictions is also quite equivalent so that deeper knowledge is indeed needed in futures trading.

[Marvell1]

But also it is a gamble I do think for us just to invest in crypto. Even if we do not trade it then we are still gambling just by hodling it.

If we look at it that way, not only is investing in crypto considered gambling, but our lives are also a gamble. Because everything has risks and we can't guarantee or be certain about anything.

Is there any guarantee that if we study hard and graduate from college, we will get a high-paying job in the future? What guarantees are there that if we start a business and 10 years later we will become entrepreneurs? Or for traditional investments such as gold, real estate...what guarantees that we will not face unexpected risks and are absolutely safe? Our life is a gamble and every decision we make is relative, there are no absolute guarantees.

[tygeade]

Futures trading is only different in terms of risk because there it is similar to a contract that can be lost when the predictions we determine are wrong because they are opposite to the direction of the road that occurs in the market. And I also thought it was similar to gambling, but the difference itself still exists because trading is always in the market, not in a casino or the like. In addition, the level of profit that can be obtained by traders who make correct predictions is also quite equivalent so that deeper knowledge is indeed needed in futures trading.

While it is true that you could lose, you could still not win and that would mean a loss but that doesn't mean if you lose that equals to gambling right away. Plenty of investments out there people could lose money, we are not calling all of them gambling, it is a common thing people do whenever they lose money n any investment they call it gambling.

There is a difference between a bad investment and gambling and people should realize that big difference. If we keep on calling it a bad thing then it will stay a bad thing and not going to get any better at all. I understand it may not be a good feeling to have any of this but we need to learn how to grow up and think for ourselves and stop calling all money losses a "gambling" because it isn't.

[nelson4lov]

A lot of people usually follow public opinions on something rather than trying it out themselves. As someone that has tried leverage trading—I have seen the good and bad side it has to it and I can confirm that leverage trading might pan out to be a derivative of gambling depending on how you use it.

I know tons of investors that use it to invest in apy/apr style defi products and also investors that use leverages to open or maintain trade positions. You don't have to go haywire with 10 to 50x leverages. Even 2-3x leverages goes a long way for an investor/trader.

Really, the tool is whatever you make it out to be.

[Stable090]

My finding points to one truth about leverage trading in crypto trading and it is no difference with gambling since whatever position you hold when the market goes against your prediction you get your money liquidated, so tell me what difference it is with gambling where you also depend on luck the win.

Future trading is a kind of trade which I don’t encourage anyone to go into, and I also don’t like going into, the risk involved in future trading is too high, and as a beginner, if you involve yourself in future trading, then you might be losing most of your money, because future trading is really difficult to understand, even professional traders do lose quickly when they are in future trading.

Most people that do say they making money from future trading, most of them end up losing most of the profits they have made in the past whenever they get liquidated, but they don’t really know about that. Lots of people trading futures don’t know how to manage risk, they are always there because of the high reward in future trading, so they are always using high leverage, and they do end up losing.

Sometimes even if you make use of low leverage in future trading, you might still end up being liquidated if there is a sharp dip or pump in d market, so we shouldn’t think its only people that make use of high leverage that get liquidated.

[Pandu Geddon]

Sometimes even if you make use of low leverage in future trading, you might still end up being liquidated if there is a sharp dip or pump in d market, so we shouldn’t think its only people that make use of high leverage that get liquidated.

But the risk will still not be the same as gambling, where when you bet then you have accepted the possibility of winning or losing. You will control whether you will use large or small leverage, all depending on your ability in trading. If you are able to increase the risk of trading, then you must be prepared to accept if you may be liquidated.
Maybe now there are quite a lot of gamblers who try futures trading, and they consider it the same as the understanding of luck that is usually done in gambling.