Trading and investing are two distinct approaches to participating in financial markets, both aiming to grow capital but differing in strategies, time frames, and risk tolerance. Understanding the key differences between these two approaches can help individuals choose the one that aligns with their financial goals and risk appetite.
1. Time Horizon
The primary difference between trading and investing is the time frame. Trading focuses on short-term market movements, often lasting from seconds to days or weeks. Traders actively buy and sell financial assets, aiming to profit from price fluctuations within these shorter time frames. In contras...