What Is The Difference Between Investing And Trading Anyway?

By Author: HG Markets
Total Articles: 1
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Investing in mutual funds requires customers to buy them and never sell them. The Post publishes a series of editorials denouncing any trading, market timing or reallocation involving the sale of mutual funds.
The concept of not selling becomes more ridiculous and hypocritical every year as scandals involving brokerages and mutual funds continue to erupt. The professionals who run the mutual fund time markets and reassign them daily, but you will ruin your portfolio if you do it yourself.
As mutual fund sales documents often emphasize, "You need to invest for the long term." and "It's okay if your investments go down because they're long-term investments." These phrases and beliefs are destructive to wallets.
Sounds like a slow-motion trading day to me as far as investing is concerned. People who don't have an investment plan use the excuse "I'm investing for the long term". However, all successful trading rules that apply to a professional forex trader with a leveraged position of $250 million also apply to a mutual fund investor with $25. Mutual finds itself immune to all decisions that are imposed on all ...
... owners, unaware that every structure needs maintenance.
Let's detail the interview.
Look at your home: everything but dirt needs maintenance. Weather, weather, and events wear down floors, appliances, roofs, windows, landscaping, and more. Landlords who rent must follow the same rules. You must follow the same rules whether you own a mall, an airport or a factory. All companies have the same rules; the building, staff, employees, vehicles, marketing plan, product design, and website.
When did you consider investing in or selling a business (or selling or investing in a business)? What makes you think you shouldn't need to keep your wallet like everything else in your life? You must understand that it is necessary to hold it in order for it to work properly. Without a doubt, most of the time you spend investing can be classified as maintenance, regardless of long-term investment theories and the warnings you get from your brokerage or magazine headlines.
For me, investment maintenance is all about monitoring, evaluating and acting on your investment goals. There is a need for continual review of the care they need. Do you think it meets your expectations? This involves looking at changes in market prospects, interest rates, inflation, recession, industry changes, new federal laws, trade disputes between countries, etc. A portfolio review is also part of the maintenance.
You may want to sell your weakest properties if a real estate increase has thrown your portfolio out of balance, or sell your most important properties if prices start to fall. Maintenance can also involve setting alerts if you want to run out of stock if it drops too much or if a profit target is reached and you want to place a stop loss order. A monthly review of the stock's 200-day moving average price may be sufficient for maintenance.
Portfolio Management
Whichever method you choose to approach investing and portfolio management, you should create your own trading rules and checklists for what to do before entering a trade and what might trigger your exit. Keep a record to see if any of your rules need to be changed, deleted or updated as your account grows. This is the maintenance required for a $25 investment in a mutual fund so it doesn't become a $0.25 investment.
The axiom "A fool and his money are soon parted" can also be applied to amateur investors. Investors who do not engage in the ongoing activities necessary to grow their investments are rarely successful. The portfolio of a professional trader who carefully analyzes and executes his trading rules can keep growing.