Comments on: Investment vs. Speculation

By: mod converter

mod converter — Tue, 16 Mar 2010 02:59:27 +0000

i added everyone whos posted their ID# here.

By: Speculator

Speculator — Mon, 08 Jun 2009 20:58:56 +0000

You are an investor? What is the difference? In both cases you risk money in favor of return. In the long run, your goal is to see a rise in price nothing else: if your profit is negative then you are simply a "sucker" even if value of company is high! Value of a company is a social construction — it is a virtual representation of price that is usually wrong.

By: RohitK

RohitK — Fri, 08 May 2009 11:59:43 +0000

@simon..I totally agree with u...about speculation And investment means long term always according to me..but i do not about others..

By: RohitK

RohitK — Fri, 08 May 2009 11:59:31 +0000

@simon..I totally agree with u...about speculation And investment means long term always according to me..but i do not about others..

By: maruli

maruli — Thu, 02 Apr 2009 13:32:41 +0000

Some times Investor, can be said speculator. I think all we life or business he a risk, so the investor or specultor is the same, but may how we look that. Thanks . We do our live as a investor

By: Strom

Strom — Thu, 12 Mar 2009 17:10:44 +0000

The investor/speculator divide is a distinction without a difference for most. As an investor in publicly traded securities, your access to relevant information is limited, imperfect and accessible to everyone at the same time. Why do you think it is so difficult for fund managers to consistently beat the market? Just because a person has long term intentions doesn't mean that their investment decisions are somehow more intelligent. Just because a person is focused on fundamentals rather than price action, doesn't mean that what they think is important actually will be. Without some kind of edge or advantage, you are a speculator no matter how many hours you spend reading Value Line.

By: Margaret

Margaret — Tue, 10 Mar 2009 01:33:38 +0000

Thank you very much for this post. It is wonderful to see such a reasonable investment philosophy being promoted by an actual investor. If the majority of "investors" in this country were actually investing rather than speculating, our economy would still be able to boast the innovation and resilience of a bygone era.

The one silver lining I see to our current economic situation is that we are starting to wake up to the idea that new business is the foundation of a strong economy. The dominant investment philosophy of immediate profit and short term exits has encouraged limited life span business models by refusing to support long term growth. Thank you for standing apart.

As a young entrepreneur with a long term business model, it is very encouraging to see that at least one investor is still looking for businesses they can be proud to be a part of for many years.

By: Behavior Gap Round Up, 3.6.09

Behavior Gap Round Up, 3.6.09 — Fri, 06 Mar 2009 19:26:06 +0000

[...] Investment vs. Speculation When I reflect on this, I realize that I spend 99.9% of my time as an investor and 0.01% of my time as a speculator. Whenever I realize that I’m in a speculative thought process (such as noticing the Dow on CNN on the ubiquitous airport TVs), I immediately try to stop. My goal is to spend 100% of my time as an investor. [...]

By: I have seen the future and it doesn’t work…totally unrelated bits’n’pieces « Worte, Zeichen, Bilder

Fri, 06 Mar 2009 05:42:49 +0000

[...] “Not surprisingly, there’s a huge amount of noise going around the system about speculation that is masquerading as investment. Worst, the two get conflated on a regular basis in the context of what the government should be doing (e.g. incenting “investment” when they are merely either “incenting speculation” or “encouraging speculation”). Of course, the endless stream of talking heads in the media don’t help this distinction.”///feldthoughts [...]

By: stockmanmarc

stockmanmarc — Thu, 05 Mar 2009 14:33:42 +0000

Hello Brad
I enjoyed this Post very much, their are many good comments made hear by the readers. Again, nice job

By: Phil Sugar

Phil Sugar — Wed, 04 Mar 2009 15:00:30 +0000

I think the difference between speculation and investment is what motivates you when you buy.

If you're buying the management, the idea, the market position you are investing

If you're just buying the security you are speculating.

As for the government trying to give an incentive for one versus the other I think the best you can hope for is that they try to set a level playing field.

By: Adam_Lindemann

Adam_Lindemann — Wed, 04 Mar 2009 14:02:29 +0000

Fantastic Brad!

By: Brad Feld

Brad Feld — Wed, 04 Mar 2009 13:54:47 +0000

Thanks for calling out Benjamin Graham and Buffett's great fear / greed quote. I have a dice on my desk that says "Buy" / "Sell" / "Hold" on it. It's currently turned up to "Buy" given everyone's fear!

By: Adam Lindemann

Adam Lindemann — Wed, 04 Mar 2009 13:48:35 +0000

Brad, I am sure you know this, citing Buffet as you do, but for the benefit of your readers. Buffet practices a type of investing called "Value Investing" which he learnt at the feet of the master – his mentor Benjamin Graham who wrote "The Intelligent Investor" and was the father of the school of Value Investing. Value investing basically talks about buying a dollar for fifty cents and selling it for $1.50. "All" that is really required to do this is by understanding the actual book value of a company by analysis of its assets, cash flows etc..and then waiting until an opportunity occurs to buying the company for a significant discount of its true value. The time to do this is when the market is irrationally pessimistic. The time to sell is when the market is irrationally exuberant. This is why Buffet always says he is fearful when others are greedy and greedy when others are fearful. Anyway, the first chapter (forgive me – it might be the second) of Graham`s book is a clarication of terms and particularly about the distinction between Investing and Speculation. That book was written in the 1930s!!!! It is quite illuminating/depressing to see that with all the "Talking Heads" in the financial media nothing has much changed in terms of getting people to understand this basic semantic distinction. Well done for turning the light onto this issue and making the point that perhaps the ramifications of the misunderstanding have resulted in bringing us to where we are today.

By: Brad Feld

Brad Feld — Wed, 04 Mar 2009 06:20:08 +0000

Jeff – I guess I completely disagree with your conclusion that “in the current environment I think there is ONLY speculation.” I think that – in this environment (and in any environment), investment is what’s needed. Now, I realize that is based on the premise that there is a difference between investment and speculation, which based on your first sentence indicates that you don’t think there’s a difference.