𝐓𝐡𝐞 𝐛𝐢𝐠𝐠𝐞𝐬𝐭 𝐦𝐢𝐬𝐭𝐚𝐤𝐞 𝐟𝐨𝐫 𝐭𝐫𝐚𝐝𝐞𝐫 𝐢𝐬 𝐭𝐨 𝐛𝐮𝐲 𝐬𝐨𝐦𝐞𝐭𝐡𝐢𝐧𝐠 𝐟𝐨𝐫 𝐭𝐡𝐞 𝐡𝐨𝐩𝐞 𝐭𝐨 𝐬𝐞𝐥𝐥 𝐢𝐭 𝐥𝐚𝐭𝐞𝐫, 𝐛𝐮𝐭 𝐭𝐡𝐞𝐧 𝐭𝐡𝐞 𝐚𝐬𝐬𝐞𝐭 𝐝𝐞𝐜𝐥𝐢𝐧𝐞𝐬 𝐢𝐧 𝐩𝐫𝐢𝐜𝐞, 𝐚𝐧𝐝 𝐢𝐧𝐬𝐭𝐞𝐚𝐝 𝐨𝐟 𝐬𝐞𝐥𝐥𝐢𝐧𝐠 𝐢𝐭 𝐰𝐢𝐭𝐡 𝐚 𝐥𝐨𝐬𝐬, 𝐭𝐡𝐞 𝐭𝐫𝐚𝐝𝐞𝐫 𝐬𝐭𝐚𝐫𝐭𝐬 𝐭𝐨 𝐡𝐨𝐥𝐝 𝐨𝐧 𝐭𝐨 𝐭𝐡𝐞 𝐥𝐨𝐬𝐬𝐞𝐬 and tell himself “I’m investing in this asset now, the price will go back later”!😱😱😱
𝐒𝐨 𝐭𝐡𝐞 “𝐢𝐧𝐯𝐞𝐬𝐭𝐢𝐧𝐠” 𝐢𝐬 𝐞𝐬𝐬𝐞𝐧𝐭𝐢𝐚𝐥𝐥𝐲 𝐭𝐡𝐞 𝐝𝐞𝐧𝐢𝐚𝐥 𝐨𝐟 𝐧𝐨𝐭 𝐰𝐚𝐧𝐭𝐢𝐧𝐠 𝐭𝐨 𝐭𝐚𝐤𝐞 𝐚 𝐥𝐨𝐬𝐬! 🙀
Vise-versa, an investor can buy a stock for the purpose of collecting dividends, but then he starts to check the charts and news every single day and sell it as soon as he makes a small profit - and only to regret years later when the stock triple the price. 😭 😭 😭
Yes, I’ve personally made the above mistakes many times in my career as a trader and investor. 😅😅😅
Often, we’re confused with these two terms, trading and investing, and we though trading is about short-term, so we can just buying whatever, as long as we can sell it later. 😰😰😰
And then we thought to invest is about long-term, so we buy something and never look at it again.
You can always buy Apple at $300 now and wait for it to drop to $200 and still tell yourself that you’re “investing”….🤨🤨🤨
You can buy a penny stock that you know nothing about and tell yourself that you’re “trading,” so it doesn’t matter…🙄🙄🙄
I think instead of focusing on the difference between trading or investing; you should focus on the golden truth of finance:
𝟏. 𝐊𝐧𝐨𝐰 𝐲𝐨𝐮𝐫 𝐫𝐢𝐬𝐤
𝟐. 𝐇𝐚𝐯𝐞 𝐚 𝐩𝐥𝐚𝐧
𝟑. 𝐊𝐧𝐨𝐰 𝐰𝐡𝐚𝐭 𝐲𝐨𝐮’𝐫𝐞 𝐛𝐮𝐲𝐢𝐧𝐠 𝐚𝐧𝐝 𝐰𝐡𝐲 𝐲𝐨𝐮’𝐫𝐞 𝐛𝐮𝐲𝐢𝐧𝐠
𝟒. 𝐇𝐚𝐯𝐞 𝐚 𝐬𝐭𝐨𝐩 𝐥𝐨𝐬𝐬
𝟓. 𝐑𝐞𝐚𝐝, 𝐥𝐞𝐚𝐫𝐧 𝐚𝐧𝐝 𝐞𝐝𝐮𝐜𝐚𝐭𝐞 𝐲𝐨𝐮𝐫𝐬𝐞𝐥𝐟
And that’s it! 👍👍👍
𝐃𝐨 𝐲𝐨𝐮 𝐜𝐚𝐥𝐥 𝐲𝐨𝐮𝐫𝐬𝐞𝐥𝐟 𝐚 𝐭𝐫𝐚𝐝𝐞𝐫 𝐨𝐫 𝐢𝐧𝐯𝐞𝐬𝐭𝐨𝐫? 𝗪𝐡𝐲?