Trading Is Not Investing

There’s a big misconception when it comes to trading. We get this question all the time, “what do you think of company XYZ, should I buy shares in the company?” The short answer to that question is, we don’t know. The reactions we get back from this answer is quite comical. Those that are not involved in our business, do not understand the concept of trading.

Knowing what company XYZ will be doing in 6-months from today, is none of our business; nor do we care. We’re active traders, we care about what company XYZ is doing today, tomorrow, this week. We focus on price action. If XYZ continues to take out key levels in another trading session, we’ll give it more attention; otherwise, we move on to the next stock in play.

Investing requires a deeper understanding of what a company is doing and how they’re doing it. The management of the company. The financials of the company; the list goes on.

Basically, investing requires a deep understand of fundamental analysis, whereas active trading requires technical analysis with an understanding of a company’s changing fundamentals.

There’s a major difference between the two.

As we’ve mentioned earlier, there’s a big misconception when it comes to trading. Most begin on this journey feeling overwhelmed with the amount of knowledge they lack; or so they think.

The media fuels their confusion and this reality is exactly why we block out the noise.

In the beginning of a trader’s career, information will come at you from all directions. Unfortunately, without proper education, coaching, mentorship; most would-be traders fail before they even understand what they’re doing. They’ve got caught up in the media trap of information overload and quit before giving themselves a chance to actually get good at trading.

Here enters patience, or lack thereof. Patience plays an enormous role in successful trading. Yes, patience also plays a vital role in investing, but in a different way. Patience when it pertains to investing, has a long-term outlook; meaning holding onto shares of a company for a long period of time. An investor has zero to do with whether company XYZ actually grows, he/she just has to have the patience to wait it out.

A trader, on the other hand, is required to put in daily work, if he/she wants to succeed. There’s no waiting to get good. What you put in; you’ll get out; period full stop. You must have patience with continued effort.

Investing is what our fathers and grandfathers have done. Buy a few shares in a company and check it every 6-months or so, in hopes of a magical price increase. Most buy shares based on a “tip” from a friend or some other outlet, not knowing what they’re truly buying into.

Then there are those that actually study a company and understand their fundamentals for long-term growth. Those are real investors.

To each, their own.

One isn’t better than the other, it comes down to personal preference. How much time do you want to put in? How active/inactive do you want to be in the markets? And more importantly, what resonates best with YOUR personality.

You may think you want to be a trader, but aren’t prepared mentally for the stamina needed to remain focused at the high level in which is required to succeed.

These are just a few questions to ask yourself when it comes to becoming an investor or a trader; because they most certainly are not the same.

About The Street Trading

Consistently Profitable.

That's The Goal.

Start with a crystal-clear vision of where you’re headed, then effectively lay the foundation to reach that goal through a systematic process.

That's The Street Trading.

We provide a straight-forward, no-nonsense results-driven trading education, that cuts through the noise to teach new and existing traders on how the stock market truly operates.

Our attention is focused on building actionable knowledge about the markets from the ground up. We construct a foundation of the fundamentals behind consistently profitable trading that you can build a career on. Take the guess work out of trading and ultimately understand what moves the market to finally flow with the Street and Trade with Clarity.

Day Trading | Swing Trading | Position Trading - It all comes down to managing risk and market psychology.

If you’re interested in learning more about what we have to offer you as a trader, come check us out at www.thestreettrading.com

We look forward to joining you on your trading journey!