TRADING vs INVESTING

Hello everyone. We hope you all are doing great and surviving well in this pandemic period. So, we’re here again with this new episode to enhance your understanding by telling you about the difference between investing and trading. As many people think of these terms carrying the same meaning but the insights are actually different. However, let’s dig in to find out that how are they different without wasting any other second.

 

  • Trading focuses on the active buying and selling of shares whereas investing is to hold the securities for long periods.
  • In trading, stocks are hold for shorter period and investors buy and hold for long periods till it reaches its full potential.
  • Short-term market fluctuations affect trading as traders expect share prices to move in a particular direction while these short-term market fluctuations are insignificant for investors.
  • Traders need to keep an eye on price movements to gain more profits because a small miss can lead to losses while investor earns compounding interest principle and tries to hold quality stocks in order to receive handsome dividends from company.
  • Trading involves higher risks as compared to investing.
  • Traders need good technical skills to time the market and grab higher profits. Investors should know the basic fundamentals and benefit to stay for long periods.

 

That’s it for now. We’ll come again to add another point in your knowledge. Till then, stay tuned and learn by using your resources. Also, you can go through with our other blogs if not yet looked at (you can find the link below).

 https://writingalpha.blogspot.com/


STAY AT HOME. STAY SAFE. WEAR MASK.

 

Thank You.

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