What's the difference between traders and investors?

This spread-betting trade illustrates the difference between amateur investors and knowledgeable traders.

My trading style does not permit me to trade with the herd, especially when the public are heavily involved. I become very nervous when in bed with amateur investors. I do distinguish between "amateur" investors and knowledgeable traders here.

I would say that today, the stock market and now gold and silver are the two main markets where investors are heavily involved. Markets such as US Treasuries and currencies are dominated by traders. So what is the difference between a trader and an investor?

Subscribe to MoneyWeek

Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Get 6 issues free
https://cdn.mos.cms.futurecdn.net/flexiimages/mw70aro6gl1676370748.jpg

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Sign up

John is is a British-born lapsed PhD physicist, who previously worked for Nasa on the Mars exploration team. He is a former commodity trading advisor with the US Commodities Futures Trading Commission, and worked in a boutique futures house in California in the 1980s.

 

He was a partner in one of the first futures newsletter advisory services, based in Washington DC, specialising in pork bellies and currencies. John is primarily a chart-reading trader, having cut his trading teeth in the days before PCs.

 

As well as his work in the financial world, he has launched, run and sold several 'real' businesses producing 'real' products.