In long term say 15 years tenure, will a trader earn less than a Investor as all famous investors like Vijay kedia urges people to stay away from trading?
Well for sure most of the moneys made are done by investing, not by the trading I assume so he have somewhat correct point of view really here. But it doesn’t really matter at all in short amounts of time. If you want to know my opinion - I agree with him fully.
I know a few individuals who were better off trading with the same amount than investing it over 15 years or more.
But trading wasnt their full time profession, all of them were salaried employees elsewhere and they had all their retirement plans in place.
They did not trade with all their savings either.
For the amount they traded with , they made more returns than investing the same amount.
In my opinion, Professional traders tend to earn more than investors over the same period time. This is because the idea of trading is to make money in shorter time. Essentailly, trading is something in which we aim to take small but significant profit in short time over and over again. If a trader has a good set-up then he or she can make the same amount of money in one year as that of an investor in 15 years. If we account for inflation then a trader might be even more profitable. An analogy would be a person investing in a piece of land of Rs 10 lakhs which becomes valued at 1 crore after 15 years or so. But a real estate agent might have sold 10 or more such lands at 10 percent profit and would have raked the same amount of profit within a year. People like Vijay Kedia may mean, I guess, that not everybody can become a trader. In my opinion also not everybody can become successful trader and not every body can become successful investors either. Both require different set of skills, psycology, expertise, risk appetite, capital etc. Some can triumph in both, some can in any one of those.
But I’m certain that with a proper setup, trading is generally much more profitable than investing, simply because that’s how it is supposed to be.
Trading with capital below 5 lakh, huge chance of going broke within 5 years, chances you will become bald sooner than later, investors are the happiest chap in the end, they will have the last laugh.
If a trader is able to survive in market for 15 years then definitely he will be earning more than investor.