Share Market Basics.

Trading and Investing are two different things and should never be confused even though they are used interchangeable in the share market world. One notable and perhaps the most important is the time each hold on to a stock.

While the investor is more interested in the appreciation of the company stocks over a relatively long periods of time. He is not very concerned with the changes in daily market as he knows that these will be overridden as time passes by. They carefully rely on the analyze a companies’ long term prospectives and follow a ‘buy and hold’ call on most stocks.

Whereas the trader is more concerned about the rising/diping of the market prices on a daily basis or even on a hourly prices. These traders tend to make money on the short term fluctuations of the market. They make use of the market outlook, industry news and general rumours to make capital gains on their money.

In todays market scenario, investors are few and traders are many since the market is unpredictable as the weatherman. Also, as a market watcher, my analysis is to be a investor, but hold on to a stock only if you are sure about its appreciation over the time. Otherwise, book your profits/losses and enter the market at a lower price point.