Confused between investing vs. trading? Clear your doubt here!
The most common debate in the equity space is ‘Investing vs. Trading’. Both terms – investing and trading – are often used interchangeably by individuals; however, they are two different concepts. While the ultimate goal is profit-making, time is the key factor differentiating investing and trading. But what exactly is investing, and who is an investor or a trader? Who makes more profit? Should I be a trader or an investor? Let us find out. What is investing? Investing can be traditionally defined as investing in asset classes where the goal is to build substantial wealth over a long period. Investors can build elaborate and diversified portfolios of stocks, mutual funds, bonds, and other investment vehicles to accumulate wealth. The benefit from the power of compounding is realised over longer investment horizons, but it sure is one that is worth the wait. Most investors do not concern themselves with short-term volatility or even bear markets. This is simply because they have a long-term growth vision and expect the markets to bounce back.