How Retail Traders Lose Big While Enriching Wall Street

How Retail Traders Lose Big While Enriching Wall Street

Gambling in the stock market is increasing, with most traders losing money while generating billions of dollars per year for brokerages and wholesalers. Will all this trading lead to big market swoons?

Topics covered include:

  • Why sports gambling has grown so much
  • How gambling in the stock market is measured, and how prevalent is it
  • Why most traders lose money but continue to trade anyway
  • How uninformed traders improve market liquidity and encourage trading by informed trading
  • Why being an asset allocator is more rewarding and as intellectually stimulating as trading


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Show Notes

How Stocks Became the Game That Record Numbers of Americans Are Playing by Claire Ballentine—Bloomberg

MURPHY, GOVERNOR OF NEW JERSEY, ET AL. v. NATIONAL COLLEGIATE ATHLETIC ASSN. ET AL. SYLLABUS—The Supreme Court of The United States

America's Sports Betting Boom by Felix Richter—Statista

Searching for Gambles: Gambling Sentiment and Stock Market Outcomes by Yao Chen, Alok Kumar, Chendi Zhang—SSRN

Stocks as Lotteries: the Implications of Probability Weighting for Security Prices by Nicholas Barberis and Ming Huang—SSRN

Day Trading for a Living? by Fernando Chague, Rodrigo De-Losso, Bruno Giovannetti—SSRN

Computer based trading system and methodology utilizing supply and demand analysis—Google Patents

Retail Trading in Options and the Rise of the Big Three Wholesalers—Svetlana Bryzgalova, Anna Pavlova, Taisiya Sikorskaya—SSRN

Amateurs Pile Into 24-Hour Options: ‘It’s Just Gambling’ by Gunjan Banerji—The Wall Street Journal

Retail Traders Love 0DTE Options... But Should They? by Heiner Beckmeyer, Nicole Branger, Leander Gayda—SSRN

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