WHAT IS THE DIFFERENCE BETWEEN TRADING AND INVESTING? AND WHICH IS BETTER TRADING VS INVESTING
Trading and investing are activities that are often used to increase personal income. Both trading and investment function in financial markets. finance. Profitability depends on the assets and the correct approach of the investor or trader. Investing is own assets to make money at their increasing value.
While trading is one of the activities of buying and selling certain assets in a fairly short time. The two types of work have the same characteristics, which are both used to save and multiply existing funds. However, there are some differences between the two This approach you should know.
Following is the difference between trading and investing
-Periode
- Investment works in the long term. For example, an investor buys a certain asset and expects its value to increase over time.
- While trading is buying or selling equity in a short time and making money from the price movements obtained.
What is meant by capital growth is that the profits from traders' transactions can vary in a wide range. Several possible options can be very profitable, and some are not. As for investment, capital grows gradually from year to year.
-Level of risk
In several articles that we shared earlier, we always remind you that trading and investing have risks. But the trade and investments are slightly different in terms of risk. Trading involves a higher risk and a higher potential return because the price may go up or down in a very short time. Whereas Investment is characterized by lower risk and lower returns as well.
-Skills
In making trades we need to make money during every trading session we do. Trading demands an understanding of analysis techniques and fundamentals. Whereas Investing, on the contrary, only demands the ability to choose the most profitable equity.
-The person who did it
The person who engages in trading is the trader who does all the work (technical analysis, following signals, selecting trading instruments).
As for investment, all work is done by investment funds or companies.
That's the difference between trading and investing both have risks but have their own differences.
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