When a person thinks of investing, the only thing that comes to his mind is risk. Obviously no one would want to lose their money. That's why they would like to invest money in such a project which has less risk and more chances of getting profit. But there are some people in this world who want to earn more profit from a short-term investment or trading activity. The possibility of losing money in this type of investment is very high. This is called speculation. It is very close to gambling. However investing always carries risk whether it is long-term investments or short-term investments.
[source](https://www.educba.com/investment-vs-speculation/)
Investing
There are mainly two types of investments that are fixed income investment and variable income investment. Most of the people prefer fixed income investment as it gives fixed rate of return such as fixed deposits with banks, bonds, provident fund, and preference shares while variable income investment does not provide fixed rate of return like equity shares or property.
I myself have worked as a temporary staff in the bank. My job was to collect Fixed Deposits and Savings accounts from various clients. I have seen certificates of fixed deposits which used to mention rate of return. Such investment products are preferred by middle class investors as the risk involved is negligible. Apart from this, buying land or property is a very good investment. It can give you handsome returns in few years.
The definition of investment may vary from person to person. Some people think investment refers to short-term profit and some of them understand long-term gain is real investment. True investors review industries and market trends first to select an asset that is safest and more profitable.
Speculation
Speculation refers to short-term investments. Such profit people earn from trading activity in which the possibility of loss is very high. But this type of investment sometimes gives huge returns also. In today's time, you will find many such investors who want to earn more profit as soon as possible. That’s why they frequently invest in high risk assets like cryptocurrency.
Despite knowing that trading activity is risky, investors invest their money in it and earn profit. This is possible only when you review the market trends and assets in the same way as you do for long term investments. But it can be very risky for new investors. I think they should first invest in such assets which have less risk. This will increase their knowledge about investment. Then he may be ready for short-term investment. Investing in high risk assets without any experience is like gambling. The only difference between investing and speculating is risk factor.
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