• MJ

INVESTING vs TRADING vs PORTFOLIO MANAGEMENT (PM) vs WEALTH MANAGEMENT (WM)

Updated: Feb 7




Today, I wanted to try another post as I'm spending all days in front of my 6 screens now (I only take breaks for sport, eating, and sleeping vastly reduced). I did tell you that I will dedicate myself entirely during these 10 days. I expected around 0.5% a day, but we will likely average double that. So far we had 8/9 green days (my fav colours). 1 day in red where we "lost" 0.5% (buying day, so mostly spreads killed us). The best day was c.5% on Tuesday. Tomorrow will conclude the 10th day of research before the "rocket launch" that I have been talking about at the beginning of the month. With that, my official race against @Elcarbonez is also starting. We have to compete with lower risk, but we have more screens :)


As I have been making so many moves to reshuffle and rebalance the portfolio and introduce many new stocks, let me take the 4 main areas of finance. 2 of which we talk a lot about here - Investing vs Trading. 2 of the others I have never seen anyone speaking about on eToro, but that's where I see myself much more. Let's go then.


1. TRADING


Probably the easiest to understand. The main difference between trading and investing is a longer time horizon. There will be many definitions, but basically, trading is short to near term vs investing is long term. Naturally, there are various types of trading, from day trading, swing trading, algo trading, and many more. For the purpose of this post, we will just stick to short term positions.


EXAMPLE: Most of my shorts are trades really. They have investment macroanalysis attached to them. You know that fundamentals are the most important to me. I need to adapt TA and news momentum to short well though. Why? Because shorts are CFDs and therefore incur fees. Given that I want to generate you the maximum return, I cannot afford to sit on a short forever. So far my best short was on $AML.L (Aston Martin Lagonda Global Holdings PLC) even though I love the company. 3X in 7 days (no leverage).


2. INVESTING