TRADING AND INVESTING

Trading typically refers to purchasing and marketing stocks or other monetary instruments for shorter periods of time, typically less than a few months. It is something that is done without much preparation or research i.e. It is said to be trading when someone purchases and sell stocks and mutual funds at will..

Investing traditionally refers to purchasing and marketing stocks or other monetary instruments for a long period of time, typically ranging over several years.....

The main advantage of trading over investing is that it offers the ability to create money irrespective of the overall path of the market or the price of an discrete stock. Traders try to buy the stock at each of the low points in the price and sell it at higher prices that follow it a few days or weeks later. This is also called a long trade. A supplementary tool that traders practice is short trading. Short trades sanction a trader to make currency when a price is going dejected by scrounging shares of the stock as of a broker at the high prices and swapping them a few days or weeks advanced with stock purchased at a inferior price.

Common Features of Traders

·         Traders enter a situation to make money.

·         Traders will short trade a currency.

·         Traders will hold for a short dated of time.

·         Traders use technical displays and tables.

·         Traders cut losses.

·         Traders take earnings quickly.

Common Features of Investors

·         Investors will purchase and hold.

·         Investors enter long positions.

·         Investors will hold for a long retro of time.

·         Investors focus on necessary analysis.

·         Investors are not worried with short-term losses.

·         Investors let profits gather.