Trader vs.
Investor
by Vincent Barry
.
. . I am often asked: What is the difference
between a trader and an investor? Well, both are
gamblers who won’t admit it. But let’s
drill down a little, as they like to say on cable
news these days, at least deep enough to strike
the Freudian motherlode: the pleasure- and
reality-principles. According to Freud (and, btw,
it doesn’t matter whether it’s
Montgomery Clift’s Freud or Vigo Mortensen’s,
though, frankly, I prefer Vigo. Monty—I don’t
know, I always thought Monty was better cast on
Freud’s couch, but that’s just me.)
Freud’s pleasure principle speaks
to the human instinct to seek pleasure and avoid
pain, immediately. True, he didn’t
exactly say “immediately,” but close
enough, since he contrasted the pleasure-principle
with the reality-principle, the capacity to defer
pleasure when immediate gratification is off the
table. Think microwave vs. oven. Anyway, the key
difference between a “trader” and an
“investor” is that the so-called trader
is slave to the pleasure principle, whereas the
investor can live with the reality principle. The
former, the trader, needs an instant pay-off,
whereas the latter, the investor, can delay it.
The investor has patience, the trader has little
or none. . . . Look for investors in hobbies such
as bird watching, fishing, knitting, and
crocheting— doing 500 piece puzzles, perhaps,
or math for fun. Traders, on the other hand, you’ll
find playing video games, stargazing, cloud
watching, and occasionally even making origami.
The key thing, though, is that both need help,
which brings us to the practical question: What
to do? Keep in mind that trader and investor
differ only in degree. So, treat the “investor”
as you would a “social drinker.” No
real problem until, say, she is doing Zorba’s
Dance—y’know, the sirtaki?— with a
lampshade on her head at a family reunion. Bell,
coolie, square, rectangle, hexagon— it doesn’t
matter what’s on her head. It’s what is in her
head that counts. The trader, by contrast, is—well,
ever seen The Lost Weekend? Cat
on a Hot Tin Roof? No? What about Fear
and Loathing in Las Vegas or Suck
It Up Buttercup? . . . Both need support. .
. . Don’t BLAME, show LOVE, offer OPTIONS,
and always stay CALM. Oops! Just tipped my hand.
. . . . BLOC, and so much more, in my upcoming
investment seminar on stock exchanges as casinos
without neon or walls painted gold, coming soon
to a club near you! . . .
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