What is the difference between Investments and trading?

[Raja]

<p style=”margin-left: 1.27cm; line-height: 0.69cm;” align=”LEFT”>Trader will buy the share because of some sense (through technical analysis, market/sector news, and so forth) that there will be price movement and selling and moving on to another share. They have no real interest in the company behind the stock.</p>
<p style=”margin-bottom: 0cm; border: none; padding: 0cm; line-height: 0.64cm;”><span style=”color: #222222;”><span style=”font-family: Roboto, HelveticaNeueBold;”><span style=”font-size: 13pt;”>Trader may not hold a stock very long or may hold it a long time, depending </span></span></span></p>
<p style=”margin-bottom: 0cm; border: none; padding: 0cm; line-height: 0.64cm;”><span style=”color: #222222;”><span style=”font-family: Roboto, HelveticaNeueBold;”><span style=”font-size: 13pt;”>on its performance</span></span></span></p>
<p style=”margin-bottom: 0cm; border: none; padding: 0cm; line-height: 0.64cm;”></p>
<p style=”margin-bottom: 0cm; border: none; padding: 0cm; line-height: 0.64cm;”><span style=”color: #222222;”> <span style=”font-family: Roboto, HelveticaNeueBold;”><span style=”font-size: 13pt;”>Investor have done a some analysis of the compay and understand what the </span></span></span></p>
<p style=”margin-bottom: 0cm; border: none; padding: 0cm; line-height: 0.64cm;”><span style=”color: #222222;”><span style=”font-family: Roboto, HelveticaNeueBold;”><span style=”font-size: 13pt;”>company does and its position in its market and believe it has long-term </span></span></span></p>
<p style=”margin-bottom: 0cm; border: none; padding: 0cm; line-height: 0.64cm;”><span style=”color: #222222;”> <span style=”font-family: Roboto, HelveticaNeueBold;”><span style=”font-size: 13pt;”>growth potential. If the price drops, they know why and can determine </span></span></span></p>
<p style=”margin-bottom: 0cm; border: none; padding: 0cm; line-height: 0.64cm;”><span style=”color: #222222;”> <span style=”font-family: Roboto, HelveticaNeueBold;”><span style=”font-size: 13pt;”>whether this is a short-term situation or long-term impact on the stock’s price. </span></span></span><span style=”font-size: 13pt; font-family: Roboto, HelveticaNeueBold; color: #222222; line-height: 0.64cm;”>An investor buys a company with the intent of holding on to the stock for a long time.</span></p>

[TAMILARASAN R]

investment is an long term process  by early basis.

trading is an short term process

[Sorna Rajeswari]

while investing the risk is less and so the returns is also less.

while trading the risk is high and so the returns is also high.

[Raghu.O.Nair]

Investments are done with a motive of ownership and earn profits as and when the company makes profits( generally termed as dividends).

On the other hand trading is done with a motive of ownership by purchase/sale of shares of the company. The difference of share value in the market is the profit of the trader.

[Prabhu Krishnan]

Investments (IPO,Mutul funds etc ) are long-term oriented whereas Trading (Stock exchange) is all about short-term focused (less a month or few months ) .Companies will share the profits in terms of dividend with the share-holders for their investments & risk taken . Trading profits are coming from change in  market price for the shares over a time period which is highly subjected to external factors .Hence the trading has high-risk factors compared to investments .

 

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