Because of the environmental and societal consequences of that action. It is a collossal miallocation of electricity, advanced manufactured goods, and the time and focus of intelligent people all around the planet.
The argument to not buy lottery tickets, is if you have no need of the return so it's not worth giving up the 5% of your portfolio that could be reliably generating returns for you.
Software engineers for example are easily capable of reliably earning six figures in the US, outside of the Bay Area. With stock compensation their earnings potential is that much higher. It's a solid multi-millionaire track if you grind away at that career path and keep your expenses in line.
So why bother with the lottery in that case? Because a few million dollars isn't enough?
If you're earning $40,000 per year with an inability to generate much in the way of savings (compared to the software engineer), your job prospects are highly capped, you do manual labor in a factory in a 2nd tier city, your education level is weak, and your shot at a multi-millionaire outcome is essentially zero, maybe giving up 5% of your savings makes sense for a shot at an epic outcome to escape that lower middle class trap.
What I've read is that one has to distribute the portfolio across a risk spectrum. A big % to very low risk / low yield instruments (say, bonds), a medium % to blue chip stocks, a smaller % to more risky stocks, etc.
So, following that logic with cypto or lottery tickets, a very small % could be put in anything that has a high risk high reward.
When you say bother you mean effort but in theory you could outsource your potfolio so there's not more work by following one strategy or another.
Thus... are lottery tickets a good thing to have in the portfolio?
I'm quite curious if there is an answer to this from a statistics or investing point of view.
Yes, it does, despite the negative expected value. In corporate finance it's known that companies that are approaching failure are often willing to pay for volatility.
This is also why lotto tickets are more popular with the poor.
It's all about Expected Return. lotto's expected return is probably ~25% of the ticket price. You could look at past performance for BTC's expected return, and that would give something >100%. But as is always mentioned "past performance is no indication for the future"
Why not 10% in comic books or any other limited non-productive asset? If we could just convince everyone to put in 10% of their savings into comic book collections, comic books too would become incredibly valuable.
