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Investing vs Trading

Investing is long-term wealth building, while trading is short-term buying and selling for quick profits.

Investing and trading are two different approaches to making money in the stock market:

  • Investing:
    This is a long-term approach. Investors buy stocks and hold onto them for years or even decades, waiting for the company to grow. They are patient and look at the fundamentals of a company like revenue, profit, and future growth potential. Investors aim for steady, gradual returns.

  • Trading:
    Traders, on the other hand, are in it for the short term. They buy and sell stocks quickly, often within a day, to profit from small price changes. Trading requires more attention, quick decision-making, and often involves more risk than investing. Traders need to constantly monitor market movements and trends.

Both strategies can be profitable, but investing is generally seen as safer for beginners.

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