Difference Between Trading And Investing

Many people things that there is no difference between trading and investing. There is a huge difference if you see deeply. Well, Stay Invested tells you the difference between trading and investing through this blog.

Difference Between Trading and Investing

Time Period:

The main difference between trading and investing is the frequency of buying and selling. For how much period you are holding stock is the main difference between both.

Short Term – Long Term:

Traders hold stock for a short period (It can be for days or months). Investors invest for a long period (It can be more than a year).

Technical Analysis – Fundamental Analysis:

As traders trade for a short period. That’s why they do technical analysis. They keep attention on the pattern and volume of shares. Where investors invest for a long period, so they do a fundamental analysis of the company. In investing, investors consider themself as the partner of the company and that’s why they understand the company’s fundamentals.

Volatility – Stability:

In trading, there is a lot of volatility because traders buy and sell stocks in a minute or day, or few months. In contrast, in investing, there is stability. Because investors invest for a long period. It can be more than a year.

Bottom Line:

Trading and investing, both are for making money. Some investors invest for a short time to gain short-term goals, as like buying a car. Some investors invest for a long period to gain long-term goals. For example retirement plans. I hope, you enjoy reading our blog. Share your thoughts in the comment section below. Follow us to know our blogs on investment and the stock market.

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