You Can’t Invest Without Trading. You Can Trade Without Investing.
by Joe · 14 things on Twos
- Article
- A trader: someone who buys stocks on a hunch
- an investor: study the health of the underlying business and learn who else is betting on or against the shares
- a speculator: someone who thinks other people will pay more for it than you did.
- The word investor comes from the Latin “investire,” to dress in or clothe oneself, surround or envelop
- You would never wear clothes without knowing what color they are or what material they’re made of. Likewise, you can’t invest in an asset you know nothing about.
- Graham said, “Outright speculation is neither illegal, immoral, nor (for most people) fattening to the pocketbook.”
- However, he warned, it creates three dangers:
- speculating when you think you are investing
- speculating seriously instead of as a pastime, when you lack proper knowledge and skill for it
- risking more money in speculation than you can afford to lose.
- If you think you’re investing when you’re speculating, you’ll attribute even momentary success to skill even though luck is the likeliest explanation.
- PAWGcoin is up roughly 900% since Ms. Rhoades began promoting it in early June, according to Poocoin.io, a website that tracks such digital currencies.
- In Ms. Rhoades’s Instagram post, she is holding up an open copy of the “The Intelligent Investor,” whose cover is reversed. She appears to be reading it with her eyes closed.