Leaving the pitch, you should decide on what position you want to play in this match. You have to choose the position of offensive and defensive. It is, which one you choose depends on the aggressiveness of your character, individual predispositions, preferences and target. The market is similar. You can become a trader or investor. If you belong to active people who can not stand still, impatient and want to act rather than wait, you can become a trader. Such a person makes a profit from short-term changes in the prices of financial instruments. However, if you can cool one's heels in a good opportunity, and the result for a long time, you become an investor and count on long-term gains.
There is a widespread belief that the reluctance to close the transaction losing and keeping changes trader in the player. Some people jokingly say that the trader makes a long-term investor, but of course in this case it's just a gamble. This type of behavior often ends sadly disastrously. Market participants begin with the aim of rapid earnings, but as soon as they begin to lose, lengthen the time horizon and their transactions change in investments, often very long-term.
Imagine that conducted the analysis of the stock. Irrelevant you have followed technical analysis, fundamental, behavioral, or all at once. However you sacrificed her a lot of time and you're proud of her. If it turns out that a well-predicted price movement then you can congratulate yourself. Expect, however, serious trouble, when will the opposite position and begin to lose. You will then have two options. Or you admit that you are wrong or the fault of the market. What do you think, what will you do? You admit that you are wrong? I suppose not, and in this way your transaction will be "investment." Perhaps you will feed your brain the idea that the market still turn away, you can not accept such a great loss, or that despite everything you're right. Do not count on it, it will. Perhaps once in a while, the market miraculously turn back, because miracles occasionally happen, but until then your wallet will suffer too much loss of funds to make up for losses.
The situation in which we do not go from the position because of excessive loss is called the personification of the transaction. It is a natural symptom of a human face. Nobody wants to lose money and to admit error. Those who have a problem with that, the market begins to expose the usually very high bill, but it is up to you at which point you say stop and pay.
One of the most famous investment principles, says "play the trend." It might be worthwhile, therefore, it is an investor in the initial phase of creating a trend, a trader in its final phase and during the reversal? Such an approach seems to be a very wise choice. As soon as the trend will pick up, say, upward, because there is a bull market, you use the method of buy and hold for as long until you see the indications of the possible completion. Then you become a trader. You sell each and uplift you are buying any discount from the frequency with which they occur. On the stock market boom usually it lasts longer than a bear market. However, during a bear market price movements and distances which overcome they occur much faster. Trader prudently managing its deposit can earn during the bear market as much as in the period of growth and is in addition to significantly less time.
Therefore it is worth to give up prejudice and not to overemphasize being a trader or speculator to put it bluntly. Loyalty works among friends and relatives, but is not on the market. The only obligation of the investor to take a position on the right - the revenue side of the market. Sometimes it will be a long position (boom), and sometimes short (bear market).