Tuesday, November 28, 2023

Misleading Article that suggests path to FIRE is by Trading


There is a misleading article in the news on last Sunday, about an executive from the Saxo trading platform that seems to hint trading enabled her to retire by her early 40s.

Yet her top investing tip is:

If you are not investing, get started now because with each passing day, you are losing out on your share of the world's eighth wonder: compounding.

True enough, she set up investment accounts for her children, so as to make them more interested in investing at an early age. 

I believe she said what she said simply because she wanted to promote the company she works for and keep her bosses happy. 

Trading and investing are totally different things. In investing, you hold for the long term and reap the benefits slowly, most likely benefiting from the periodical dividends as well. Trading, however, you hold for a short-term maybe days, weeks, or at most a couple of months.

I started off with trading in my early journey, thinking I could 'beat the market'. Took me a while to realize I could not do it consistently. Moreover, the roller coaster ride gave me undue stress and made me lose a bit of focus on my regular work. I believe the sooner one realizes this the better. 

I have since switched to long-term investing and never looked back. 

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