Crash Betting: The New Way to Play the Stock Market

Binary options have become an extremely popular way to play the stock market due to their simplicity and the number of platforms that support them. You’ll often times find that many of the top binary options brokers also support regular trading, so if you’re already playing that way you have an obvious choice with what service to use.

But what if you don’t want to focus on trading? What if you want to simply place bets on whether or not a stock, index, or fund will hit a certain price level?

Well, in that case you might want to try out crash betting.

What Is Crash Betting?

Simply put, crash betting is the practice of placing bets on events that are likely to happen rather than on outcomes that are already determined. To use the above example; let’s say you believe that Amazon is going to have a price decline soon, so you place a bet on it hitting $100 within the next few months. If the price of Amazon ever reaches $100 within the next few months, you’ll win your bet and make some money, but if it doesn’t then you’ve wasted your time and effort. But at least you tried something new and different!

The beauty of placing a bet on a stock price decline rather than an actual earnings report or a trade announcement is that in many cases the former is more reliable. After all, companies have to report their earnings and make announcements about upcoming mergers and acquisitions, but there is no immediate consequence for a wrong prediction. So in some cases you might find that placing a bet on a stock price decline is actually less risky than placing a similar bet on an actual important event.

Why Place Bets On Stock Price Declines?

The main reason why you might want to place a bet on a stock price decline instead of an important event is because the latter is often more unpredictable. For instance, it is not uncommon for companies to announce major acquisitions or to make significant financial news that has a significant impact on their share price. But sometimes these events can be completely unrelated to the next earnings report or to what investors actually want to hear. This can make it very difficult to predict which way the stock price is going to move after an important announcement, because there might be a lot of people who see the news but don’t believe it will have a significant impact on the company’s bottom line.

On the other hand, a price decline in response to a rumor, a misleading headline, or a tweet about an unimportant event is generally less likely to be a coincidence and more predictable. Especially since in many cases the rumor, headline, or unimportant event actually has a significant impact on the company’s share price.

How To Place A Crash Bet?

So how do you place a crash bet? It’s actually quite straightforward, and similar to placing a bet on a stock price decline. All you need is a broker that supports this type of trade and a bit of creativity.

Let’s say you want to make a bet that Amazon is going to decline in value. To do this you would contact your broker and ask them to place a bet against AMZN hitting $100 within the next six months. When the price reaches that level you’ll win the bet and be able to enjoy the fruits of your labor (at least for a little while).

Make sure to place your bet on a stock that is not prohibitively expensive to trade, as it will make it easier for your broker to take the bet against you if you’re shorting the trade. Also, be sure to use a leverage platform so that if your bet loses, you don’t lose more than you’re actually responsible for.

Now, if you want to make a really long shot bet, things get a little more complicated. For example, you might want to bet on France winning the next world cup. To do this you would contact your broker and place a bet on France winning the 2018 FIFA World Cup™. If they choose Russia as the host nation, you’ll win your bet and be able to go home with a nice trophy. But if they decide on France, you’ll end up losing your money, because you’ll have placed a bet on a sporting event that Russia will win.

How Do You Make The Most Out Of Your Win?

As we discussed above, the beauty of placing a bet on a stock price decline is that in many cases the former is less risky than placing a similar bet on an important event. So if you win a bet on a stock price decline, it is generally a good idea to wait for a while before cashing out. Especially if you’re placing high-risk, high-reward bets like shorting a stock or putting up a long bet on the French World Cup win.

Also, make sure you keep good records of your bets and manage your risk properly. If you’re using a traditional stock brokerage account, it’ll be much easier to get into trouble if anything goes wrong. And of course you can’t predict anything, but unfortunately this is where most people’s gambling problems begin; by not keeping good records and taking unnecessary risks.

The Pros And Cons Of Placing A Crash Bet

So, what are the advantages of placing a crash bet? Well, for one thing, it’s a new way of playing the market and trying out a new strategy or game. You might enjoy the opportunity to make a little side bet on the side, without needing to worry too much about your own finances. Since you’re not exposing yourself to significant risk, it might be a good idea to place a crash bet every so often to help you stay creative and engaged in the process.

The main disadvantage of placing a crash bet is that it doesn’t always have the same appeal or thrill as gambling on important events does. After all, it is more difficult to place a bet on a rumor, a misleading headline, or a tweet about an unimportant event rather than an important one. So it is always going to be more difficult to attract the same audience, and thus make the same amount of money, if you’re placing a bet on a rumor or unimportant event rather than on an important one.

Example Of A Predictive Model In Action

As an example, let’s say you’re an investor who doesn’t want to take on too much risk and you’re looking for a way to place some side bets while staying within your own means. One of the best ways to do this that I know of is to use a predictive model. A predictive model is simply a mathematical formula that helps you assess the probability that a particular event will occur or that a certain stock price will change based on certain criteria.

So let’s say you have a model that analyses the market to show that there is a 75% chance that Amazon will decline in price, within the next six months. When you combine that with some smarts about risk management and betting, you have a fairly reliable way of making a little extra money without needing to take on too much risk.

Predictive models make a lot of sense when used this way, and can be very effective tools for helping you place side bets or make small investments. Just make sure to do your research about the accuracy of these models before making any significant decisions. Also, make sure to check out the regulatory status of the model you are using, as some markets are more heavily regulated than others. And finally, make sure that you are using a model that is built to take into account all the different factors that might affect the price of a stock, fund, or index. In some cases, a simple model might not be sophisticated enough to account for all the different variables and thus could potentially lead you to make bad decisions.