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Comparing an investment vs. speculative mindset The line between investing and speculating can be fine. In fact, many speculators jump into investments and run up their prices.
Speculation usually involves more risks than investment. Nicholas Kaldor [ 7 ] has long argued for the price-stabilizing role of speculators, who tend to even out "price-fluctuations due to changes in the conditions of demand or supply", by possessing "better than average foresight".
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There are four key differences between the speculative nature of frantic trading you see on TV and in movies versus long-term investing: Time horizon and goals.
But fictitious capital is also the object of speculation. The market value of such assets can be driven up and artificially inflated, purely as a result of supply and demand factors which can themselves be manipulated for profit. The inflated value can just as rapidly be punctured if large amounts of capital are withdrawn. [13]
Investment is traditionally defined as the "commitment of resources to achieve later benefits". If an investment involves money, then it can be defined as a ...
Often, when reading about investing, especially as it relates to the stock market, you see a comparison to gambling. Indeed, many people are scared off the idea of investing due to the regular ...
Investment vs. Speculation. Actually the title of the first chapter in "The Intelligent Investor" it'll have some good discussion; A shorter version of the etymology section: it mostly lines up with a book called the "dictionary of word origins" that I have; Some examples that show the complexity of speculation vs. investing