Jason Gunkel, Chief Investment Officer, explains that recent speculative events in the financial markets, including the run up in the stock price of GameStop, have provoked many to question if investing in the stock market is similar to gambling.
Although both investments and gambling, have the risk of losing money, Jason explains how the two are quite different.
As Jason says, “The longer you sit in a casino, the greater the odds you’ll walk out a loser. But the longer you stay invested in the stock market, historically, the greater the probability you’ll experience positive outcomes.”The chances of having a positive return in the stock market in one single day is over 50%.
The chances increase to over 75% in any one-year period. For a 5-year period, the chances of having a positive return in the stock market are 88%. Over a 10-year period, the chances of a positive return increase to 95% and over a 20-year period, the chances of a positive stock market return are 100%.
Finance Moment…Syverson Strege’s mini-podcasts to provide rapid-fire information on financial topics of the day.