Trading glossaryReviewed 16 July 2026
Definition
Trading and investing are distinct decision processes differentiated by purpose, evidence, expected horizon, turnover, review frequency, and planned exit conditions.
In market context
Trading commonly targets a defined price move or event over a shorter window, while investing allocates capital toward longer-term value creation, income, or diversification. The same instrument can support either process, but a failed trade does not become an investment merely because its exit was ignored. Separate policies, budgets, and records help prevent short-term losses from consuming capital assigned to long-term goals.
Source
Use the primary source for fuller regulatory or market context.