3 ms·

isn't all investment speculating?

• kuschku 9y ago
  No, usually investment provides money for people that want to build something with it, and you get it (and a small profit, for the risk) back afterwards. In this case, though, no one but you has a benefit.
  • z3t4 9y ago
    What about running a top level domain (TLD) ? Instead of company shares you get a domain name under that TLD.
• dguo 9y ago
  The Benjamin Graham (who taught Warren Buffett) distinction between investment and speculation is: "An investment operation is one which, upon thorough analysis promises safety of principal and an adequate return. Operations not meeting these requirements are speculative." See http://buffettpedia.com/2015/07/investment-versus-speculation/ http://buffettpedia.com/2015/07/investment-versus-speculatio... Personally, I think it's helpful to think of it as a spectrum rather than as a necessarily binary distinction. Graham's definition is nice and succinct, but the problem comes with the word "promises". The safety of principal for anything cannot be guaranteed beyond all doubt.
  • rowyourboat 9y ago
    "Promise" is not meant in the strict logical sense. "Promise" can also mean "to give cause to strongly expect", as in "the upcoming thunderstorm promises hail damage". In this case, it probably means "the investor is reasonably sure of". No, it is not an exact definition, but we are dealing with human behaviour and value judgments here, not mathematical proofs.
    • dguo 9y ago
      Yep, I agree. That's why I like to think of it as a spectrum. Based on analysis, someone can believe one operation is more of an investment than another operation. I know I was being pedantic, but I wanted to avoid making it seem simpler than I think it really is.