One of the biggest advantages we have as retail traders is flexibility. We’re not tied down, we don’t have to answer to clients, and we can switch between strategies whenever the market demands it. We should be grateful for this.
I also think that different assets require different tools.
To Trade or Invest?
I have always considered trading as the short term tool to use when looking to capture market volatility over minutes, hours or days. I align macroeconomic events with sentiment and technical opportunities with the goal to profit from short term movements. I feel that FX, Indices and commodities are great for these short term movements.
On the other hand investing is about holding positions for weeks, months or even years based on the bigger picture. You don’t really look at the technical movements in the market because the goal is to benefit from longer term appreciation. Stocks are my go to for investing, but you can also think about physical commodities such as gold and silver.
The Retail Trader Advantage: Flexibility
The truth is you don’t have to pick one or the other. As a retail trader, you can adapt.
Sometimes the market screams for short-term trading.
Other times, the setup favors longer-term investing
Think of it like having two different tools in your kit. You wouldn’t use a hammer when you need a screwdriver, and you don’t need to trade when the market is better suited for investing.
My Thoughts
Don’t box yourself in. The best traders I know aren’t “just day traders” or “just investors.” They’re flexible. They read the environment, pick the right tool, and manage risk accordingly.
Trading and investing aren’t rivals. They’re two sides of the same coin, and knowing when to switch between them can give you the edge.