Wager, Speculation, Stocks and Gain

Pankaj Gupta
10 min readJul 10, 2021


Photo by Edge2Edge Media on Unsplash

Wager is a bet or guess or speculation of an event on the outcome of which you have no control. The best example of wager (as given by Justice P.B.. Gajendrgadkar) is the flip of a coin. When there is a bet that on the flip of coin as to which side is up, Head or a Tail, none of the party has control over the coin’s movement. Hence the chances of Head or Tail coming up are 50–50 and no one can predict the outcome correctly. There is no skill involved and the outcome of wager is totally dependent on chance or luck. Wager is thus in the nature of Gambling and in many states it is banned or is punishable.. In Hindi it is also called Satta. In game of cards Flash is nearest to Wager or Gambling and unless stakes are trivial, it is punishable. Of course we play Flash or in colloquial Teen Patti during Diwali in typical Hindu tradition when Bhagvan Shivji gambled in celestial manner with Goddess Parvati and the stakes were spiritual or ethereal.

About Satta I have an interesting anecdote to tell. I had occasion to be headquartered in a town in Maharashtra which had thriving business and was the wholesale market for adjoining areas. The business was well set; there was not much to do on the Gaddi and therefore Seth log became inveterate Sattebaj. Forward market is nothing in comparison where few thousand rupees exchanged hands on a bet of increase or decrease of price of grain and in this town such novel methods of betting were invented which will challenge your imagination. The betting was done on the interplay of natural elements and in agrarian economy and in a grain Mandi (Mart) what natural element than Rain can be the base of betting. Therefore betting went on like this. On a particular day when onset of Mansoon was expected say 10 th June Satta was placed on the intensity of Mansoon. If on first rain water flows on the tinned grooving of the roof (Called Gacchi) it was called “Gacchi”. This is the first event to be put to bet. The second event is when rain fell so much by a fixed date that rainwater falls on a particular covered Kaweloo (Terra-Cotta burnt Banglorean Tile), it was called “Kaweloo”. The third event was “Farshi” i.e. the floor of the causeway. Causeway requires a little explanation. It is a typical arrangement of Deccan India where rivers are seasonal and are in full spate in rainy season. In summer they are almost dry. The typical cost cutting method was to pass the road over small bridge just above the level of river water during normal times like October-November. In summers people cross the river by going over the road called Cause-way. The river flowed as a thin stream way below. In rainy season the river crosses over the bridge and people wait on the side till water recedes. You will be thrilled to know and see Narmada River Causeway at Maheshwar built by our very own Maharani Ahilya Bai Holkar. And that brings to me my epic journey across India in our car with my young wife and my mother and passing Narmada at Maheshwar and Tapti at Burhanpur (Called Rapti in Maharashtra. Mumtaj Mahal, wife of Shah Jahan died here of Child Birth Complications after birth of her 14th child who was none other than Aurangzeb) which was in floods and we had to stay put in Burhanpur for 2 days. I have distracted. Therefore friends on a fixed date, when it rains so much that rainwater flows over the floor of Causeway over a rivulet in the centre of town it is called “Farshi”. The last one is “Jhirra” which is onomatopoeia meaning that water is seeping or percolating down and water falling in a well is called “Jhirra”. The bet is that on a fixed day, it rains so much that a well situated on the Bank of the rivulet is also flowed over and water falls into it This is “Jhirra”. This type of satta is so rampant and the bets are so huge that many well to do gaddis have lost fortunes and one such Seth on losing his whole Kothi in this kind of Satta, committed suicide.

Speculation is on the other hand is a more skilful and money oriented activity though it is also a gamble. Speculation is defined as the purchase of an asset with the hope that it will become more valuable in the near future. Here you see that a more systematic approach is made and obviously so because a lot of money is involved. Thus, Speculation is investment in stocks, property, etc. in the hope of gain but with the risk of loss. The tragedy is that the best sentiment of mankind i.e. Hope is clubbed with gain, risk loss and money. There is also distinction between Gambling and Speculation. Speculation and gambling are two different actions used to increase wealth under conditions of risk or uncertainty. … Gambling refers to wagering money in an event that has an uncertain outcome in hopes of winning more money, whereas speculation involves taking a calculated risk in an uncertain outcome. Thus we see that from gambling which was a pastime and entertainment, it became a habit forming addiction, than more money got involved and it became Satta, thereafter with improved economic conditions, surplus money was required to be invested so that it can be useful in difficult times but as they say Habits Die Hard and in the Hope of gain but with Risk of Loss, the system of speculation started. The urge to earn more money becomes a compulsion and the saving for difficult times, putting it in bank for favorable rates of interest became, in the hope of gain i.e. earning more money led to investments with more risks and chances of doubling or rather quadrupling of money invested. We have heard many stories of number of sober, balanced people losing the lifetime of their savings in speculation.

And this brings us to stock markets. I have many interesting stories to tell but let me start from the beginning. A typical method of trade in the stock market is to buy when prices are low and sell when prices have gone up. You would be laughing at such oversimplification and obvious proposition of stock market. After all what I am trying to say. This is the basic rule of business. A very brainy junior of mine who has written some books on mathematics observed that reverse of it will or should be true. My Means What? was met with stoic reply that you sell when prices are high and buy when they low. I conceded yes but then… more of it later. The best example of Share market or bourse is that it rises and falls at its whims and fancies. Not one person has been able to predict this fall or rise and if there is one like me, whom you think has even a wild idea of pattern of rise & fall of stock market, I would not be sitting in stifling weather and writing these homilies. However I have theories as everyone might have but let us state one very common saying about the stock market. It is an oft quoted saying and it is

‘Nobody takes money home from Stock Market’

The natural corollary to it is a lurking challenge to the new entrant and he plunges head on into it. The beginners luck works for some time and when the stakes start getting higher a series of losses bring you thud on the floor. It is not without reason that every site on how to make money in stock market talks of market research, homework, patience and discipline while dealing in stocks. The message is loud and clear that it is not easy to earn in Stock Market yet people come in large numbers for quick gain, which Friends, is never there.

Once I was on leave and happened to go with one of my friend to a stock broker where he had some work about his shares. I was sitting with the main share broker and his friend when they laughed aloud. When I raised my eye brows, one of them asked me:- Have you dealt in share before?

I replied in negative but asked: — What was that blood bath you both were talking about?

They both again laughed aloud and one of them said: — Sometimes this Stock market resembles a butcher’s market and hence we were talking of blood bath!

To my almost fixed raised eyebrows, they explained: — The stock market is a butcher’s market. The buyer is a sheep. Their following each other blindly is bhed-chal. They walk into the trap and come to be butchered here and hence the blood bath.

I asked- Why you both are laughing then?

The matter got a serious turn. Both sat erect and one of them said: — ‘Sir what we are using is market language. We are bystanders on the sides. The main protagonists are the buyer and sellers and the market is the butcher. We have to act as agents of buyer and seller and not their advisors. When in the ring and action takes place someone gets harmed and some reap advantage. If you have a boxing match and one boxer gets pummeled by another, few of the spectators clap then how you react? This is the same in bourse. Please don’t take that someone has died or injured by the words blood bath.’

The other Share Broker gave another example. He asked me.” Have you heard the fable of Yaksha and Yudhishtir of Mahabharta?

I replied,- ‘Yes’

He said –‘Please tell what is the answer to Yaksha Question to Yudhisthir that. ‘What is the biggest wonder in this world?’

I said ‘I do not remember’

Share Broker said, Sir Yudhishter replied that

“Day after day countless people die. Yet living (person) wishes to live forever. O Lord, what can be a greater wonder?”

He further said that day in and day out, we can see that people are going to lose money, that they are going to repent this investment or speculation as you will perhaps say but still they do not detest. They are like Lambs to the slaughter house and we can do precious little but laugh at the inevitability of this process.

I said ‘ But whyyy……..? and suddenly realized that a very solid lesson has been taught to me and with a peevish smile said ‘I understand !’

The share Broker broke the silence and placated me by saying- ‘And Sir This herd mentality makes the investor do reverse to common sense thing. It is that when the market has risen quite a bit they start buying. But suddenly with so many buyers and no sellers, market plummets. All the buyers become sellers but then there are no buyers left in the market. The then buyer and now potential seller is left holding the sack and sells (if lucky) at the rock bottom price. On account of this Sir, he buys at high price and sells at the lower or lowest price (To avoid loss), which is reverse to plain common sense’.

I asked- But who controls these ups and downs of Market?

Share Broker looked philosophical and said, — ‘Sir who controls the waves of sea and who can predict when a bigger wave will come and when flat waves will continue.’

Then he became more to the point and said that, ‘ Basically when a lot of money is invested on speculation on a particular share, market corrects itself and the value of that share falls to the desired level to achieve a balance.’

The example of the sea waves gave me a fair notion of what happens and to earn in Share market what should be done.

Now physically speaking, the waves in the sea have a high point called peak and low point called trough. The problem is that no one knows how big is the wave and where the trough is in a particular movement. The guiding factor is hope of increase of very high level i.e. a very big profit or OUR GREED. That becomes the controlling factor. We forget that not one person controls the market and thousand persons giving tips and some even manipulating the market, nothing is certain. I therefore have devised a safe buying selling formula so long the quotient is fixed. This quotient is Greed or our target. After that, catch the up-going arm of the wave and sell at your target, whatever the market sources may say of a high peak. Traders will call you a fool but fine you are not loser.

To catch a sliding arm is more difficult and risky once a share has reached quiet a high point. Sell at the earliest and cover your loss without bothering that you have incurred loss because if not careful you might incur further loss.

However these all are piper’s dream as I have never the Time and Inclination to indulge into share purchase and sale activity. Still the obvious factor for me is that Human Greed is the running Leitmotif in all these activities given in the Title. You control the Greed you make money. But a counter question arises- If you have controlled the desire to make money or quick money, why indulge in any of the above activities given in the Title?

I rest my case.

Let it be,

As Goddess Laxmi

E-231, Windsor Park Desires and chooses

Indirapuram, Ghaziabad Her Abode

3rd July 2020 Pankaj Gupta

Speculation is the purchase of an asset with the hope that it will become more valuable in the near future.

Speculation is investment in stocks, property, etc. in the hope of gain but with the risk of loss.



Pankaj Gupta

A retired Police officer, he enjoys creative writing based on his experience of interacting with people. Why pankajgupta.tk? Dedicated to his three kids (tk)