Trading Vs. Investing

So here’s a topic that we come back to often, Shana, but I think it’s well worth coming back to trading versus investing. And I just want to start by just defining our terms. What is trading? What is investing? How are they similar? How are they different? What are your thoughts on that? So trading is going to be really focused on the short term.

So it looks at stocks, it tries to capitalize on short term trends, you know, getting in and out of different positions. Investing is something much different. Trading is really more like gambling, you know, because you’re trying to make a quick buck.

It’s typically motivated by greed. Investing, on the other hand, is looking for long term opportunities. You know, if you were going to, you know, as an individual, if you were going to open a business, maybe you are going to buy an existing business.

What are some of the things that you would look at? Well, you would want to see that the company has, has had a successful track record. It’s got a good customer base, it’s got reliable revenues. There’s the ability to manage expenses in a good way, in a profitable way.

So what we propose is that you are an investor, not a trader.

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Changing your plan may require you to select new sectors for certain stocks

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