You might’ve been wondering what is the difference between Investing and Trading, or you might’ve been asking yourself: “Am I an Investor or a Trader?”, or you might’ve never even realized that there is a difference in the first place. In this article I will explain the difference between Investing and Trading.

The definition in it’s most basic form is:

“Investing is the attempt to make money over a LONG period of time”

“Trading is the attempt to make money over a SHORT period of time”

Now the question is: “How long is a LONG period of time, and how short is a SHORT period of time?” The answer is: “It’s up to you!”

What does this mean? It means that you might consider 6 months to be a long period to hold on to one stock, so you’ll call it Investing, and someone else might consider 6 months a very short period of time and they’ll call it Trading. (more…)

Many of us have images of our aged selves in various forms of comfort and luxury. Nobody ever dreams of spending his sunset years stuck alone in a rundown home barely able to make ends meet. Definitely not the kind of ending one wishes to have after living a full life. Not when you have worked all your life in order to have your family live comfortably. You surely have a grand plan for yourself, right? (more…)

Mutual funds are designed for average investors who wants to invest but do not want to select and manage investments like stocks and bonds on their own. In other words, they are the investment of choice for most people.

When you invest in them, professional money managers deal with all the details. You select the fund(s) you want to invest in and they do the rest for you. The average person can have a diversified and balanced portfolio of securities (investments) by simply owning shares of the appropriate mutual funds. (more…)

If you are living and working in the United States, you are definitely fortunate because you are capable of saving for your retirement and at the same time defer present income taxes on your saved funds and earnings until such time that you can carry out distributions or withdrawals. You can choose to place a portion of your wage or income to be directly paid or deferred into a 401k account, which is recognized as a contribution.

In actual fact, this retirement investing option is an employer-sponsored account. Your employer or company has the full discretion to grant you benefits as their employee by optionally selecting to match up part or all of your contribution by means of making additional contributions in your account or grant you with profit sharing benefits in your retirement account. (more…)

A client has recently asked me if I could “explain what short selling is and how hedge funds use them. I have heard they are highly risky and I also know of concerns that exist about some of their ethical standards.”

Unlike the simple buying of shares where an investor buys them hoping that they will rise, short selling is a tactic used to make money when a share price goes down. If the price does fall the person who has shorted them gains and vice versa. (more…)