What are the differences between an investor and a trader?

in the public opinion investing is something noble - while trading is considered as gambling.

in reality most investors are gamblers - and only few really know what they want and how to reach it - and the same is valid for trading.

so the difference lies in the image solely - imho.
 
Investors don't know what selling short mean. They only do well in bull markets. Smart investors get out during bear markets and reenter when the conditions look better. Traders are in the market regardless of market conditions and go with the trend.
 
As an investor (presumably not a bad investor), Time is supposed to be on your side. ie: collect dividends, interest, etc.
Beyond that, the difference is pretty blurry.
 
Originally posted by Dan da Stik
An investor is a trader who fell in love.
More...
how about this...

You've got to be very careful if you don't know where you are going, because you might ... get there

:D
 
rcreal posts what I think is the main difference between an investor and a trader. The investor has an interest in the growth of the company based on the fundamentals of that company. It is a mindset. The investor's concern for technical analysis is minimal.

CANSLIM participants use a rigorous fundamental filter combined with technical buy points. They do not short. Yet most of the exit strategies for CANSLIM participants are based on ideas other than changes in the fundamentals. Thus, I would call them traders and not investors.

Marketsurfer makes a brief but cogent point... time. Again, however I think it reverts back to the reason for the purchase of the stock. An investor buys because of his belief in the long term growth of the company, regadless of the technical picture, while a trader might be on for the long term... as long as the stock is above the 200 day sma.

Hey, maybe the difference is the investor uses fundamental analysis primarily with an open-ended time frame in mind, while a trader use technical analysis primarily with a closed-ended time frame.
 
inandlong,

You are one smart guy.

I'd have to say that, unfortunately, most investors don't have the time or trading savvy to actively manage their account -- so they pick what they feel are good long term stocks with solid prospects and put their money into it.

There are probably many investors who make a lot more money than active traders. There are also probably many traders who make a lot more than investors.

I am both now. I have invested some money in Oracle for the long-term because I feel they are grossly under-valued.
 
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