Some time ago I wrote a Blog about the differences between ‘Traders’ and ‘Investors’ as I see them - you can read it here:
Anyway, recently I have been thinking about this and refining the idea in my mind and I have sort of come to the view that the Trader / Investor thing is really a ‘Spectrum’ with varying degrees of each and most of us will fit somewhere on this Spectrum.
The differences are mainly around the:
Here is my fairly simplified view of the Spectrum - starting with the extreme end of what I would call ‘Trading’ and ending with the extreme form of ‘Investing’ (when you consider this approach, ‘extreme’ is probably not the right word !!):
The Blog ‘How many Stocks should an Investor hold? Are you drowning in Stocks or is there a drought in your Portfolio?’ can be found here:
The Blog ‘Why Invest? The Power of Compounding’ can be found here:
I hope you found this Blog got you thinking - I am quite pleased with it as I doubt it is a concept many people have really considered before - and even if they have they will not have read something like this I suspect.
In Part 2 I will look at Differences and Commonalities between the different types of Traders / Investors, and also cover what is best for Beginners and some Warnings around mixing styles.
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