Is trading on the
stock markets a zero sum game? The answer is no, it's a negative sum
game.
Why is this so?
A zero sum game is
like a friendly poker night where each of seven players brings $100
to gamble with. When the game ends with some winners and some losers
the most that can be taken out the door is the original $700. There
is nothing added to the original sum. No new group wealth is created.
If on the other hand
the seven gamblers go to a commercial poker game where the “house”
takes a small portion of each pot (game), less than the original $700
sum goes out the door. Substitute stock broker for the “house” in
this simple scenario and hopefully the point s made.
Paul Hunter budhunter@frontier.com
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