> Your observation about young people with four-figure net worths thinking it’s rational to gamble it all on options is pretty much this week’s equivalent of those living paycheck-to-paycheck “investing” in the lottery.
It's not—the lottery is by design guaranteed to have negative expected returns. The stock market isn't.
Not sure whether it makes sense to average all returns and call it "negative expected returns" across the board. As with any game that mixes luck & skill (like poker), trading has a variety of expected returns. My guess (based on poker) is that a large part of people are small losers or break-even (in poker because of rake, in trading because of trading fees), some are big losers (in poker called whales), some are small winners (regs), and some are big winners (truly good players / traders).
It's not easy figuring out in the beginning which bucket you fall into, but if you accurately track your poker / trades over time, then with a large enough sample size (assuming proper risk management of course) you should be able to figure it out.
Sure but the comment I was replying to was referring to young people with four figure net worths gambling on options.
There are some successful traders but I strongly suspect those trading options with four figured are in lottery world. A few win big, most lose all, aggregate expected returns negative.
It's not—the lottery is by design guaranteed to have negative expected returns. The stock market isn't.