![MMT - DF [CPS] IN - ADM](https://indoleads.nyc3.cdn.digitaloceanspaces.com/uploads/offers/banners/5e689a1314796.jpeg)
Whenever a beginner enters into the stock market, then this question comes in his mind that what is this business and investment and what is the difference between the two and it is also necessary to come to the mind of this question because until someone The difference between what is needed and what is needed will not be understood till then how will he decide what will be suitable for him according to his defense capability and goal.
What is trading
(Trading vs investing topic 1)
So let us first discuss that this is trading, if we understand trading in Hindi then it means (व्यापार), trading simply means that whenever you buy shares of a company, and on any day But sell it also, means that you cannot keep any share for a long time in stock trading, buy your shares today at ₹ 120 and after selling it at ₹ 130 today itself, make a profit. We call the process trading.
types of trading
(Trading vs investing topic 2)
Hello friends, in today's article trading vs investment, we will tell you how many types are there in trading, when you enter the stock market with many beginners, you people have to hear and hear a lot of trading names, so you guys You get very confused that, what kind of trading is swing trading, what kind of trading is intraday trading, many such questions come in your mind and many people start all kinds of trading without knowing what they need to do. Information is not available because of which you suffer loss, so friends, that's why we are going to tell you about the type of trading.
- Scalp trading: Friends, the first type of trading is scalp trading, which takes very less time, like you create a position between 1 minute to 5 minutes and exit, then it is called scalp trading in the stock market, as if you have Buy a stock and within the next 5 minutes whether you make a profit or a loss, if you exit, it is called scalp trading.
- Intraday trading: Friends another type of trading is intraday trading in which we create any position after market open and market close within a day and exit os position it is called intraday trading in stock market like any of our position at 10am Created and the market closes by 3:30 PM, even if you exit your position at 3:00 PM, it is called intraday trading.
- BTST trading: Friends, the third type of trading is BTST trading, whose full form is BTST (Buy Today - Sell Tomorrow) i.e. you have created a position today and hold it overnight and next day after the market opens. If you exit the position then it is called BTST trading in the stock market.
- Swing trading: Our fourth type of trading is swing trading, in which we take advantage of a swing, like Manlo, if the market is going down, then if you think that the market will swing upwards, then you buy shares when the market Will swing this time to sell hold it For 2-4 days if you hold the stock for more than 2 days and keep the position then we call it swing trading what we do in this 1 day 2 days 3 days 1 week or 2 If you hold the stock for a week then it is called swing trading.
- Positional trading: The fifth type of trading is positional trading, what we do in this is to ban your position from 1 month to 1 year and exit it, and if you don't hold it for more than a year Yes, we call it position trading, As we understand from the example that today you have bought a share and hold it for 5-6 months and after that you can sell this share, then in such a situation it is called positional trading in the stock market.
What is Investing
(trading vs investing topic 3)
Types of investing
(trading vs investing topic 4)
Hello friends, in today's article trading vs investment, we will tell you how many types are there in investment, when you enter the stock market with many beginners, you people have to listen to the names and names of many investments, so you guys Many people get confused that, what kind of investment is active philosophy, what kind of investment is passive investment, many such questions come in your mind and many people start all kinds of trading without knowing it.Those who are not aware, because of this you suffer losses, so friends, we are going to tell you what are the types of investments. Friends use different strategies for investors to invest in share market, all investment strategies can be divided into 5 types of philosophies 1 passive income philosophy 2 active income philosophy 3 growth investing 4 value investing 5 dividend investing,
- Passive income philosophy: Passive income philosophy investors believe that we can not generate more than the average return in the stock market by doing nothing in the long term, but if a stock market index has given a 15% annual rate of return in the long term. We're in the same market. Investing in companies for the long term can only generate a maximum rate of return of 15% per annum, and investors following this passive income philosophy are fooled by the painstaking effort of finding good companies in the stock market Because friends, in passive income philosophy, the investor believes that no matter how much analysis is invested in any company, in the long term, more returns cannot be made than the returns of the stock market, so they invest in all the stocks directly indexed in the stock market. Invest only in the stock market index, so that they can make a return equal to the return in the stock market index, which according to them can be made in the stock market, the maximum possible return and the investment in the stock market index is mostly issued to the index fund Friends, index funds are a special type of mutual fund. Those who invest only in the companies included in the stock market index, like if an index fund is of Nifty 50, then it will invest only in the 50 companies included in the Nifty index, and it will also invest in that and it will also invest in that, as Male companies will invest us in stock market index is available, is investing in Tara Index Fund just like investing in any stock market index, Friends passive income philosophy is actually from efficient market theory According to this, all the investors of the stock market are always rational, which means that they always take their decisions very thoughtfully and in a logical manner, which makes the stock market an efficient system, which at all times is the best for every company. Tells the price of the share exactly and it can never happen that we get the share at a cheaper or more expensive price than the share price
- Active income philosophy: Active income philosophy is exactly the opposite of passive income philosophy. Investors who follow active income philosophy believe that most of the investors in the stock market are irrational, that is, they cannot think their decision carefully, rather they take it in haste based on fear and greed. The stock on which the restrictions on market timing have been removed in an inefficient system and because of this the companies are often priced much below or much above their fair value, and taking advantage of this, in comparison to the stock market index in the long term very high returns can be made,// Friends, investors who follow Active Income Philosophy believe that if we analyze the companies in the stock market, then we must tell good companies at a lower price than the right price, by investing in which we can get more returns than the average returns in the stock market in the long term. Friends, we hear the stories of successful investors who have made more than average returns in the stock market and that too for many years, the US stock market has given an average annual return of 10% in the last 50 years. And the world's greatest investor Warren Buffet has also made annual returns of up to 20% in the last 50 years, and the same great investor of India Late Rakesh Jhun Jhunwala has made annual returns of up to 65% in his 37 years in the stock market, While the Indian stock market index has given an annual return of around 14% for the same 37-year-old men, friends, investors who follow the active income philosophy feel that we should invest in an index fund only when we are interested in stocks. Do not have a good understanding of the market, ya when we do not want to try to find stocks by doing some research, but if we understand the stock market and invest by analyzing the companies, then we can invest in the stocks of the companies in the long term. Stock market indexes make good returns.
- value investing: value investing, investors invest in a company whose share price has fallen below its true value or it is getting cheaper than its true value, and when the company's share price rises from the cheap price when its true value But it comes to the investors to buy at a cheap price, make profit by selling the stock at an expensive price, friends, in value investing, investors feel that every company has a right price, which is called the intrinsic value of the company and the intrinsic value of every company depends on the strength of its business and its ability to make profit, often in the stock market the share price of the company falls below its intrinsic value in the short term and the shares of such company fetch a discounted price in the long term. Over the period, each company's stock is priced around its intrinsic value, and profits can then be made by selling the stock at a discount, at a higher price
- Growth investing: Growth Investment Strategies investors invest in companies that grow their revenue and profits faster than other companies in their industry and these strategies I investors are prepared to invest in companies at any cost, Growth investing In strategies, investors have a feeling that if a company has been increasing its revenue and profit rapidly for a few years, then its changes are very high, it will continue to increase its revenue and profit at the same pace for some time, due to which With this, its share price will also increase and investors will benefit.
- Dividend investing: Dividend investing investors invest in companies that seem to be paying good dividends, which investors continue to earn on their investments, and for this reason dividend investing is often also called income investing. Instead of increasing the price of shares, more attention is paid to the price received from the dividend, because in this the main goal of the investors is to make a good dividend on their investment.
Trader and Investor
(trading vs investing topic 5)
Whenever it comes to the profit of investors and traders in the stock market, it is definitely mentioned and with this a question also comes whether the profit of investors and traders is the same or different? And if there is only one then why these two names? And if they are different then how? But don't worry, we are going to clear this confusion in today's topic trading vs investment. To get success in the stock market, it is very important to have a good bonding between the investor and the trader, only then you will be able to decide what can be more profitable for you, becoming an investor or becoming a trader, so let's start and know that investing Do and continue for trading, about investors and traders, friends, investment and trading have to be done in a different way. there is a big difference between the methods If you look at the chart of trading and investment in this way, stocks are held for a very short time in trading and this time can be even for 1 week, then often even for 1 day because the trader will buy hi stocks till the high profits they get in the short term. Prefer to hold i.e. trading period is very short whereas investment is quite different because in this the real work of the investor is to buy and hold the stock, ie for a long term, which can be for a few years, then it can be much longer than that, that is, the period in the investment method is very long. Investors are interested in getting the biggest returns by holding stocks for the long term and traders are interested in enjoying small daily profits. Looking at the points of capital growth, traders keep an eye on the price of shares in the market, if the price is high, then traders need to sell shares, that is, timing also has a big role in trading, which affects capital growth. While capital appreciation is achieved by holding investment quality stocks for many years as investors like to earn profits with compounding interest and dividends, the stock market is a risky market when it comes to risk appetite. Whether it is talk or trading, it remains risky, but in trading it is very high in the competition of risky investment. Because in short time the price can be high and sometimes low and they are also risky for investment but they are very less but the returns received in short term are also less but if held for long term So the ongoing returns of compound interest and dividends can be very high. focus on style Traders and investors have different working style Traders like to play one day game and investors like to play test match Traders are attracted to quick results so the same investors find the formula of slow move and strategy right Market forces teach traders to focus on high profit in quick time Investors prefer to invest in best stocks by analysis stocks But if the right timing is missed, the potential for losses increases significantly, as traders look at the current performance of companies, buy and sell, when these do not matter to investors, they want to invest in value and hold for the long term. For the period. It is their job to keep an eye on the stocks held by them, they have enough of everything, so they bring the stocks to their right price so that they can be waited for. And then sell your stocks to reach profit, if see who is more smart or who gets more profit then brother it is difficult to say because both traders and investors have different method and style of working. It is the opposite but the goal of the trader and the investor is the same, to make profit, so it means that the one who has achieved his goal, that is, made profit, is successful and the it is also your choice, what you like, short Short term people issue money for small profit, invest for long term, earn more by holding stock, sell at high price, desire wealth, because you can choose what is interesting and do Be easy it is investing or trading, your goal of making profit from the stock market should be met. by the way, if you have understood the working style of investor and trader, the similarities between them, then on this subject, just scroll down to know about the difference between business and investment.
Different between trading vs investing
(Trading vs investing topic 6)
| Characteristics | Trading | Investing |
|---|---|---|
| 1) Typical Personality | Rabit | Tortoise |
| 2) Time Horizon | Hours/Days/months | Mon/ Yrs/Decades |
| 3) Risk Level | Medium-High | Low-Medium |
| 4) Time- Daily | Very High | Very Low |
| 5) Time- Overall | Very High | Very Low |
| 6) Information | Technicals | Fundamentals |
| 7) Stress Level | High | Low |
| 8) Stocks Decline | Sell, Next stock | Average, Research |
| 9) Expenses | Very High | Low |
| 10) Successful | George Soros | Warren, Rakesh |
| 11) Key Traits | Quick Action | Patience |
| 12) Famous Saying | The Trend | Two Rules |
IMPORTANT NOTE
If you are facing some problem in Tech and digital world, then you tell me in the comment.
Thank you...for visiting🌹
Rate This Article
Thanks for reading: Trading vs investing -type of trading and investing , all differences, Sorry, my English is bad:)