Gambling or Using A Talent

Yesterday I saw an interesting program on TV, featuring some people in Japan who took up day trading – the making of stock and forex transactions within a single day. Those people are ordinary businessmen, businesswomen, and housewives who do not want their employers or husbands to know their secret investment activities. There are others who trade for a living, by renting a room and making transactions all day.

Obviously, day trading is not for everyone. There is a housewife, who invested her life saving of 10 million yen, (about $80,000), increased it to 60 million yen, and lost nearly all of the gain in a couple of years. Similar stories abound with people losing the bulk of their savings.

At the other end of the spectrum is a man who started day-trading at the age of 25 with his personal saving of 8 million yen. After 10 years, his wealth is now over 500 million yen (about $4 million), meaning an increase of 63-fold. He is a disciplined man who does not eat breakfast or lunch so that he can concentrate on trading. This reminds me of the line spoken by Sherlock Holmes in the BBC program, “I don’t eat while I’m working. Digestion slows me down.”

What is the difference between gambling and demonstration of an investment talent? Only the result can tell, as the sheer chance of trading every day for 10 years and increasing investment by 6200% is astronomically zero.

Of course, one would also need skills, knowledge, education, experience, and strategies for day trading, but only talent can tell which skills, knowledge, education, and strategies are worth having.

Kimoto Financial Translations

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