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Essay / The Pros and Cons of Investing and Trading - 550
Investing implies that research influenced a person's decision and required them to buy and hold a security over a period of years . Trading is the buying and selling of the chosen security over a much shorter period of time. This often goes hand in hand with less in-depth research into the fundamentals of the stock. Investing and trading are different methods of trying to profit from the financial markets. The objective of investing is to gradually create wealth over an extended period of time through the purchase and holding of a portfolio of stocks, baskets of stocks, mutual funds, bonds and other investment instruments. Investors typically enhance their profits by reinvesting their profits and dividends in additional stocks. Investments are often held for several years or even decades, enjoying benefits such as interest, dividends and stock splits. Even if markets fluctuate, investors will wait for downtrends to end with the confidence that prices will rebound and any losses will eventually be recouped. They are generally more concerned about price/...