Context:
Investor - Placing ones capital into instruments for a defined period of time, seeking an overall continued accumulation of balance based on the combination of planned contributions, market growth, dividend reinvestment and portfolio diversification. Generally these are 401, IRA, SEP, Roth's, etc. Most are tax-deferred shelters.
Trader - Placing ones capital using a risk/reward combination of strategies over a short or extended horizon.
Sub categories include but are not limited to
1) Day traders - Using large volume of capital exposed to markets over seconds, minutes or within a day for taking advantage of sophisticated technology, technical analysis, education and experience.
2) Short term trader - These are generally trend specialists who use all of the above and add options strategies to limit risk on exposed capital on trades they enter.
3) Swing trader (My personal approach to non-restricted or 3 day trade rule restricted trades) IRA, SEP and trading account application of macro trend analysis, primarily surrounding identified major support/resistance markers. Strategies include buying/selling at major support/resistance technicals, 200 day moving averages, selling covered calls at strong resistance levels, especially during sideways market conditions (which ironically Mr. Wrighty wrongly says is impossible to spot), Futures (primarily overnight), all forms of options strategies - Can you say "Iron Condor"?
4) Numerous other trading strategies (See Aggiemetal as Exhibit A)
Most importantly VOLUME signatures because when big money is making waves they can't hide their moves!
So, in context, how about we not mess up an otherwise enjoyable discussion? I use a combination of all of the above. That said - my trading returns crush any buy and hold strategy.
So why not trade using 100% of everything? Because that isn't how I established my disciplines and strategy. Factors such as owning companies that crunch out cash for investing requires my time. I find that equally enjoyable. Maybe others should as well.
Happy investing or trading!
