A couple of years ago I was into trading, it was a fun ride and very educational. I learned the value of money, time, patience and discipline. Trading has thought me, that emotions get the best of us. However sound your trading strategy may be, it will always turn you to the losing end.
Both trading and investing will teach you patience and discipline. Trading on the other hand, is more stressful and instantaneous. Wrong decisions are punished immediately, right decisions rewarded just the same.
Investing will teach you slow money. You wait for years for your fruits to unfold. But in a sense, its more accurate than trading.
I felt that trading, even though having good success with trading, is much like a gamble. No matter how many times I have seen a pattern on a chart, I know what the next scenario would be, and I would trade accordingly, still I am not sure if it will come to my favor or not. For me, it felt like gambling.
I do not like the feeling of having to "guess" no matter how sound the decision is.
Trading is fast, but it comes with a price, you will need to trade your time for the fast reward. Investing is slow and comes with luxury of time.
When you trade, you spend time waiting in front of the computer. From the opening session to the closing. With investing, I feel like I'm reading a book. I'm not in a hurry to buy a share. I want to finish reading the "story" before I could decide. The story is seen in the balance sheet. Comes the time, if I like it, I'll then decide accordingly. In trading there is no such luxury. You are always pressed for time. Trying to outsmart/outspeed the other buyer or seller. I do not like the cut throat environment of it, nor do I see the need for such haste.
I think investing is better, when it comes to comparing resources used for the return on investment. Money should be ignored, assuming both a trader and an investor use the same amount of money. What we have left to consider is time.
A trader will have to spend more of his time to earn. It is the actual time trading. If the market opens at 9:30 and closes at 3:30pm, he just spent 6 hours of his life, everyday to earn a living. An investor may read a company's balance sheet at his leisure, before sleeping or at the breakfast table with his coffee, buy a stock for 5 minutes to get an order and go hiking somewhere, take his wife to a date and play with his kids, travel with his family for the rest of the week.
Its all about the quality of time spent for the amount of reward. Let's say that a trader manages to return 50% on same year (difficult but not impossible) and the investor manages to have a return of 15% (average). I feel like that the investor has a better life when you think that the trader spent his whole year looking at a computer screen 260 days and 6 hours per day (1,560 hours), and the investor spent the same amount of hours with his family, learning new things, traveling and what not. To think that a 30 year old person only has 200,000 hours (give or take) left for his life, I feel that life is too short not spending it with your loved ones.
A trader may "make money from having money" but its the investor who "makes money work for you". Because of the two, its the investor who have the free time and let money do the working.
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