INVESTMENT, SPECULATION AND GAMBLING

 Investment, Speculation & Gambling

Investment 

Investment is parking money for at least one year in an investment avenue of the choice of the investor, normally assuming moderate risk with the expectation of a fair return. Own funds or borrowed funds may be used for this purpose and decisions are taken mostly on informed news. A person who does an investment is an investor.

Speculation

Tansaction done with the intention of holding for a few days, assuming high risk with the greed fit superborofits / return. He may borrow more than his capacity. Decisions are taken on scientific basis. Example : Meteorological prediction that monsoon will be poor and much delayed. One person invested in Voltas (Manufacturer of air conditioners) with borrowed money, but contrary to the prediction monsoon was normal. Volats share price crashed. He lost money.

Gambling

No scientific application of knowledge purely intuition. Gambling creates high risk. It is illegal. I 

Example : When one day Cricket Match is held at Kochi - many speculators may engage in bets.




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