Financial Investor, Financial account manager, ..
..
Trader, they are all involved in investments.
The account manager as a spokesman / adviser for the clients' portfolio, the financial investor and trader direct involved with their own portfolio.
When talking about the investor in this article the portfolio investors is meant; someone who builds a portfolio of stock (basically) to manage personal wealth.
What is - productivity-wise - the difference between these two? Can any investor become a trader and a trader become an investor? The portfolio is the key in understanding these differences.
Ownership is another key element and the essence of the difference between a trader and portfolio investor is the relation between the ownership and the portfolio.
Ownership is something emotional.
You own a house, which you have bought in most cases well above the reasonable (rational) price.
According to the penny-wise pound-foolish principle, the larger the investment to higher is the probability that emotion is involved in the decision taking process.
The portfolio investor builds a portfolio with stock and other investment instruments.
Once this portfolio is constructed, the ownership principle starts to rule the decisions of the investor.
"The portfolio is mine and I have carefully selected the stocks in it.
" The trader on the other hand, owns nothing.
Any stock is just a product in the market that moves because of the same emotion.
The trader buys and sells with the flow of the market and tries to make a daily profit.
That is his reason for living.
The more emotionally attached to the stocks in day-trading-portfolio, the more difficult to trade these.
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