I was reading a very interesting piece on “Chico” (actually Leonard or “Chicko”) Marx and his lifetime (and his gambling addiction). The most telling statement about this addiction was:
Chico’s gambling was actually a very serious addiction. When the Marx brothers were filming their movie A Day at the Races in 1937, Groucho noticed Chico placing a bet on a horse that was scheduled to lose a race in the film’s script. “Are you crazy?” Groucho asked incredulously, “That horse is going to lose the race. The script says so.”
“I know,” Chico replied, “but I couldn’t resist. The odds were fifteen to one.”
You might laugh at that, but I have spoken with investors who have had the same odd views on “long shot investments”. If you invest in enough of them, they will eventually pay out, is their credo. That kind of a “system” is what built Las Vegas (on the money lost using those same systems).
You think I am mistaken? How does one explain Pets.com or some of the other interesting “Internet bubble” stocks of the 90’s ?
Some people are simply adrenaline junkies, they want to feel “alive”. If you want to feel alive, run marathons, help the poor, volunteer, but don’t make stupid decisions because you have a hunch things might turn out big (unless of course you are willing to lose all the money you are using).
Do you know why long shots, are long shots? Mostly, due to the fact that they are not supposed to win.
Anybody have any stories of long shots gone wrong? Any gone right ?