How to Know the Difference of Trader And Investor

Many players in the forex market or stock considers himself as an investor. But on the other occasion he admitted he was a trader. The term ' investor ' and ' trader ' is often considered to be the same, or be interpreted that a trader is also because investors have invested some funds, and an investor is also because traders are certainly going to do trades.
In the investment world, ' trading ' and ' investing ' was a different activity although traders and investors alike jumped on the market. Point of view, the way things work and the strategies they are very different though their purpose is exactly the same IE the get the maximum profit in the shortest possible time. In this article reviewed points difference between the two.

That included investor

In the investment world in General, which is categorized under investors are those who put their money in long-term investment instruments such as real estate or a home, large or small scale industry, or invest in the stock market or commodity market to be held in the long or very long (decades). Basic consideration of investors focused on the product to be purchased or the type of business that will be accessed. For an investor's shares, it will choose a company that actually has a very good performance.

Investors can be classified in the institutional investors (institutional investors) such as banks, financial institutions other than banks, insurance companies and other investors, and retail or individual investors. Discussed here is more on individual investors, who typically do not have a clear plan when later results investment losers. They will likely cut-loss to switch to other investment instruments, or left with the hope that its value will rebound and will generate a profit.

They usually respond to changes in market rates with misgivings. For example when the gold price drop as it currently is, those who invest in gold is certainly very anxious. But of course not all applicable individual investors, they are serious with plans and investment strategies to sophisticated and mature will be reaped great success. Warren Buffett is an example of one of the world class individual investors were hugely successful.

That included a trader

If investors are focused on the product to be purchased, traders focused on sentiment and market conditions. A trader in the stock market less concern for the performance of the company's shares to be purchased, as long as market sentiment towards the company is positive he will buy the shares for resale as soon as possible. In addition, he will take into account market conditions, if the stock market is being hit by the political atmosphere conducive to stock price index was down, then he would not enter the market until the situation is back to normal.

Compared with investors, transactions made traders more short-term in nature with far greater frequency. From the survey results that been done, the majority of traders rely on revenues from trading (trading for living), both in the stock market, stock index futures, forex or commodities. In General, traders have the methods, strategies and plans in a clear and purposeful because they usually do not hold positions trading for too long.

They use stop loss and profit target, the risk/reward ratio in order to limit losses and set the profit as well as techniques in money management to maximize profit which may not be used by investors. Traders have been adept at going into all kinds of markets, good market forex, stocks, commodities or futures. George Soros, founder of the Quantum Funds is an example of one of the world class trader is very successful.

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