Investing Vs. Trading

Who are you? Are you an investor? Or are you an trader? Creditor? Debtor? Either way, what is the difference between investing and trading? There is a similarity but there is a distinction between the two.

Normally, we earn money in accordance to the hours we are spending on working. The more hours, the more income. But the hard-earned money is not stable as we use many things in out daily lives. Do you want to earn money without working? In this way, it is your money that will work to earn more money. This then is where investing and trading will participate.

Investors are people engaged in investing and traders are people engaged in trading. The stock market is always the basis of everything. This stock market is not stable that sometimes, it will go down and later on, will be restored. It often moves. Investing and trading are different in this case.

Investors are more conservative than traders. Investors are for long term security while traders hold the securities for a short time. Investors need to understand the performance of the company and its future prospects. This is where the investors base their decision. So sometime, they use the company’s financial reports and data. They are interested to the capital growth over time. Meanwhile, traders are more interested in the movement of the price than the interest payments. So they take advantage and rejoice in the fall of the price of security.

Both investing and trading are good. But you just need to distinguish between the two so you would know your position. There are pros and cons of the two, but if you are smart, whether you are a trader or investor, your hard-earned money will not be in vain.

Additionally, at times of risk, investors have lower risks than traders.