There are a very few people who really care to know whether they are traders or investors. However, to be successful, it’s important to determine whether you are a trader or an investor because it makes a difference. Investing is for a long period of time, while trading for a short time. Now it’s up to you how long the long period for you or how short is the short period for you. For some people, six months is a long period to own a stock. On the other hand, for some six months could be a very short period.

Nevertheless, as a rule, the duration of opening and closing a business deal in days and weeks is said to be trading, whereas the duration of measuring a transaction in months and years is said to be investing.

Typically traders are only keen on seeking the price chart of a particular security or currency, they hunt for specialized patterns, or for fields of supply and demand to decide on their entry point, and they do likewise to fix their exit, they remain in one transaction for any period between a day or less and a few weeks, they take a deeper look at the market on a regular basis, to examine whether their trade is still applicable or if it’s time to shut it. A trader needs to be well-versed with technical analysis and remain updated on market scenarios, and latest events that have the proclivity to change these state of affairs.

Scalpers start and end a transaction very fast, in seconds or in a few minutes, seeking small gains; however they implement dozens if not hundreds of similar trades on a daily basis. Day Traders stick to their positions longer than Scalpers but they never maintain any open trades for another day, they shut everything prior to the end of the day. Swing Traders stick to their positions for days or weeks. Now, you can determine the kind of trader you are in order to succeed.

Investors depend mainly on the basics to settle on buying or not, and while traders can earn profits in an upswing or downswing market, investors can only make profits when the price is ascending as an investor’s verdict of investing in a particular company is in line with his or her belief in the company. Investors go through the financial statements of the company and they try to search as much as they can about the internal actions of the company, like about its management, their future plans, their competitors, etc. Essentially they try to study the company on the whole and its prospects of growth. Such investment is known as Value Investing. Investors do not really pay heed to the small every day fluctuations of the cost as they suppose that if a company has a big intrinsic value, then its share cost will follow eventually, so they try to acquire the companies with high value and selling at a bargain cost.

Thus, traders and investors are different people and trading and investing are not really the same ballgame. An individual needs to identify whether he or she is into trading or investing before shelling out funds.