There is a Difference Between Investing and Trading

Most people that dabble in investing are just that, investors. Some people venture down the "trading" rabbit hole.

If you have read my posts before you know that I am a former full time day trader turned real estate investor/cryptocurrency investor.

The trader in me comes out more often than I would like, especially because with crypto the best strategy over the long-term (in my opinion) is to buy and hold.

Differences between the two....

I'm going to use my latest RUNE trade as a difference between investing and trading, at least in my point of view.

When the crypto sell off happened last week I jumped into a few coins, most of which to make a short-term gain.

And that for me is the difference with those adds. As an investor and if I was wearing my investor hat the adds on this drop would have been simple dollar cost averaging or buying the dip, which something I preach when it comes to coins you plan to hold atleast 3 to 5 years.

The exit is the other difference, with an investment you are basically holding your position for the bigger longer term gains, with hopes of new highs over the long-term.

With trading, you are looking to bang out profits at the first resistance or pivot point and then maybe hold some to see about continuation.

Back to my rune trade...

Looking back at the chart you will see the highlighted area in the mid 13 area.

That was basically my short-term trade target for the upside bounce, with an eye on the pivot levels marked by the purple boxes.

As I added to the position on the way down I also unloaded on the way up. Selling at 10.80 the prior pivot low in April and the again at 13.50 at which point I left 100 coins working to see if price pushed higher, at which point I decided to book that at 14.52.

Now, if I had just held the entire position up I'd of made twice the money, but I also would have had the full downside risk still and it is easy to say that knowing the coins broke 14 and could go higher.

And that is the difference again, if it was an investment I'd still be holding all off it or the majority off it as booking a little profit is never the worst idea.

Any coin I trade I already have a separate long-term hold position on it elsewhere, that is why I try not to sweat the "could have made more" on the trades....though, I admit it still gets me sometimes.

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