Trading vs. Investing
How do you label yourself in the investing scene?
There are many posts on the internet that offer a range of insights from both a technical perspective as well as a fundamental view. Although they can co-mingle in certain instances, you usually fit into one of the two labels: trader or investor. It would be quite onerous for one to engage in both (unless one is a business for you and the other can be done on your personal time). For beginners though, you should know the difference and ensure to establish what your financial goal is before embarking on your journey.
Traders
Short-term view with little regard to long-term performance of company
Active buying and selling to capitalize on short-term price fluctuations
Target both rising and falling markets
Expects to maximize returns on a daily, weekly, sometimes even monthly basis
Requires high commitment of time to be actively engaged
High risk needs to be accepted
Technical indicators weighed more than market or company fundamentals
Investors
Long-term interest with high regard to financial status of company’s future state
Often passive investing as more likely to buy and hold
Short-term fluctuations are not of strong interest
Expects to maximize returns over a long time period
Requires patience but less commitment of time
Lower level of risk
Market and/or company fundamentals are considered more over technical indicators
