Greetings…
Assume that I invest my money in share market. I bought 10 lots of XYZ shares for $10,000.00 or in other words each of the share cost me $1.00 [simple calculation: $1.00 X 1,000 X 10 Lots = $10,000]. A week later, my friend told me that my share appreciates to $1.50 each. So I sold my 10 Lots share at $15,000.00. Assuming that the commission and any form of service fee are insignificant, how much do I make? The Answer: I made $5,000.00 [Gross Profit] in a week time.
Allow me to ask one more question. Where is that $5,000.00 come from?
Most people would answer ‘I do not know’
Some other people prefer not to answer.
Perhaps, few of them would answer, ‘The money derived from the market’.
The TRUTH is…
That $5,000.00 derived from those [the other investors] that already LOSS their money OR will LOSS their money in the share market!
The $5,000.00 is not from a genuine business, economic or investment activities. It is the money from the other unfortunate people in the share market. I do not see any different from getting the money through lottery ticket. Millions of people buy a lottery ticket for $1.00 and one of them get $1,000,000.00. That $1,000,000.00 is not derived from the sky. It comes from the unfortunate people who bought the lottery ticket for $1.00.
Please do not lecture me as if I do not understand the true mechanism of share market. I understand the purpose why any government and any financial system require the existence of share market [such as BSKL, NYSE, FTSE, etc.]. I understand such system is to ensure the liquidity of the share investment. Without the market, those who buy the shares would face difficulties to sell them. My MBA specialized in Finance and my PhD is also in Finance. But the explanation of the system does not justify the real application or practice of this ‘corrupt system’. The action and the intention of so-called investors who aim for the capital appreciation when they bought the shares make the whole thing similar to the system of Lottery Ticket. The same goes for those who 'investing' in Foreign Exchange and other financial derivatives.
I fail to understand why NOBODY, not even the MUFTI Institution understand this and comes with a FATWA that investing in the share market with the expectation of capital appreciation especially in short period of time is GAMBLING.
I am not against anybody that buy share for long term investment and targeting to make profit out of the dividend declared. That is a genuine investing act. But these people could also easily be blinded if the share value increase drastically and they would be tempted to sell their share in order to gain instant profit. Having says that, they will not be different as compare to those who purely buy shares with capital appreciation motive.
Just remember, every time you make money due to the share value goes up, you are not really making money BUT you get your money from someone else. And that someone else could be you one day.
Stop GAMBLING ooopss… I mean stop investing in share market [unless you really invest purely to get the dividend at the end of the financial year]. It is not worth it.
Thank you for your valuable time.
Dr. Tahoma
Assume that I invest my money in share market. I bought 10 lots of XYZ shares for $10,000.00 or in other words each of the share cost me $1.00 [simple calculation: $1.00 X 1,000 X 10 Lots = $10,000]. A week later, my friend told me that my share appreciates to $1.50 each. So I sold my 10 Lots share at $15,000.00. Assuming that the commission and any form of service fee are insignificant, how much do I make? The Answer: I made $5,000.00 [Gross Profit] in a week time.
Allow me to ask one more question. Where is that $5,000.00 come from?
Most people would answer ‘I do not know’
Some other people prefer not to answer.
Perhaps, few of them would answer, ‘The money derived from the market’.
The TRUTH is…
That $5,000.00 derived from those [the other investors] that already LOSS their money OR will LOSS their money in the share market!
The $5,000.00 is not from a genuine business, economic or investment activities. It is the money from the other unfortunate people in the share market. I do not see any different from getting the money through lottery ticket. Millions of people buy a lottery ticket for $1.00 and one of them get $1,000,000.00. That $1,000,000.00 is not derived from the sky. It comes from the unfortunate people who bought the lottery ticket for $1.00.
Please do not lecture me as if I do not understand the true mechanism of share market. I understand the purpose why any government and any financial system require the existence of share market [such as BSKL, NYSE, FTSE, etc.]. I understand such system is to ensure the liquidity of the share investment. Without the market, those who buy the shares would face difficulties to sell them. My MBA specialized in Finance and my PhD is also in Finance. But the explanation of the system does not justify the real application or practice of this ‘corrupt system’. The action and the intention of so-called investors who aim for the capital appreciation when they bought the shares make the whole thing similar to the system of Lottery Ticket. The same goes for those who 'investing' in Foreign Exchange and other financial derivatives.
I fail to understand why NOBODY, not even the MUFTI Institution understand this and comes with a FATWA that investing in the share market with the expectation of capital appreciation especially in short period of time is GAMBLING.
I am not against anybody that buy share for long term investment and targeting to make profit out of the dividend declared. That is a genuine investing act. But these people could also easily be blinded if the share value increase drastically and they would be tempted to sell their share in order to gain instant profit. Having says that, they will not be different as compare to those who purely buy shares with capital appreciation motive.
Just remember, every time you make money due to the share value goes up, you are not really making money BUT you get your money from someone else. And that someone else could be you one day.
Stop GAMBLING ooopss… I mean stop investing in share market [unless you really invest purely to get the dividend at the end of the financial year]. It is not worth it.
Thank you for your valuable time.
Dr. Tahoma
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