Srading.com

Menu
  • Home
  • Markets
    • Forex
    • Stock
  • Fundamental Analysis
    • Economics
    • Money & Banking
  • Technical Analysis
    • Drawing Tools
    • Chart Patterns
  • Tools
    • Online Charts
    • Economic Calendar
    • Interest Rate Today (Live Widget)
    • Forex Market Hours
    • Currency Indexes Chart
    • National Holiday Calendar
    • CoT Chart
    • Quotes
Home
Stock
All Types of Investors Explained
Stock

All Types of Investors Explained

June 3, 2022 Zafari

Types of investors are defined by techniques that investors employ to analyze the market.

An investor applies a combination of fundamental analysis and technical analysis. A pure fundamental or technical investor does not exist. Everyone utilizes some degree of both in his market examination.

Generally, we can say someone is a fundamental investor (who uses macro and micro data to analyze the market) or a technical investor (who uses charting techniques).

To grasp what I mean, I explain both of them separately.

Fundamental Types of Investors

A fundamental investor is someone who uses fundamental analysis in his investment strategies. He uses both macro-data, such as the unemployment rate and the GDP, and micro-data, such as earning and sales growth rate of a company.

Of course, he uses technical analysis but less frequently.

Broadly, there are two types of fundamental investors, value and growth investors.

Value Investor

A value investor makes investment decisions after examining a company’s performances and macro-data, such as interest rate and the GDP. He does predict the future and cares about the present and market performance.

A value investor tries to know what a company is doing. For example, he should understand the areas such as sales, accounting, supply chain, and so on.

Last but not least, a value investor often sticks to established companies and industries. He is not very interested in new technologies because their risks are much higher than established industries.

Warren Buffett is an example of a value investor. He does not invest in a company unless he knows its operation etc.

Growth Investor

A growth investor is a risk-taker who wants to predict future technologies and industries to make a higher return.

A growth investor tries to predict the future, take risks, and hope to get a higher return.
Often a growth investor wants to see the next five to ten years and invest in industries belonging to those times.

Younger investors tend to be more in this category because they are more risk-taker than aged people.

Technical Types of Investors

A technical trader is a market participant who uses charting techniques such as indicators, candlesticks, and chart patterns to place his trades.

Technical investors believe that the market discounts everything, and you can see their behaviors on the charts. Moreover, they believe everything in history repeats itself, and you can spot them on the chart much faster than by reading books about history.

A technical investor often trades more frequently than a fundamental investor. He trades what he sees on the chart and does not trust too much fundamental data.

Based on techniques that a technical trader uses, he belongs to one of the following categories.

Scalper

A scalper is a trader who opens and closes his position in a short period, such as one hour or 30 minutes.
A scalper is going to benefit from small volatilities not what big organizations such as the world bank and IMF tell.

Scalpers rely heavily on technical analysis and technical tools such as indicators and candlestick patterns. They do not often follow the news but may track economic calendar events to minimize their losses.

Day Trader

A Day Trader opens and closes his position during the day. He usually opens and closes trades on the same day but sometimes may let them last for two or three days.

Swing Trader

A swing trader opens his position at the start of a trend and lets his positions reach till the trend ends (if he is right).

A Swing trader is a short-term trader.

A swing trader uses both technical analysis and fundamental analysis.

Wave Trader

An Elliot Wave Trader is someone who uses wave analysis techniques.

An Elliot Wave trader believes that everything in the world moves in waves and patterns. Their job is to read them.

Share
Tweet
Linkedin
Pinterest
Reddit
Email
Next Article
Tags:Stocks

Related Articles

Stock Market Bubble: Stages, Signs & Examples

Stock Market Bubble: Stages, Signs & Examples

Sector Rotation: A Complete Guide For Beginners

Sector Rotation: A Complete Guide For Beginners

What Is the Stock Market? A Definitive Guide

What Is the Stock Market? A Definitive Guide

What Is a SPAC? A Short Route to Go Public

What Is a SPAC? A Short Route to Go Public

What Are Bull and Bear Markets? (Plus Examples)

What Are Bull and Bear Markets? (Plus Examples)

What Is an IPO? A Definitive Guide

What Is an IPO? A Definitive Guide

About The Author

Zafari

Zafari is a professional trader and has been in the financial market since 2014. He has a bachelor of public economics and an MBA. For some reason, he does not show his face. And he loves you all!

Leave a Reply Cancel Reply

Recent Posts

  • Trading Psychology: 8 Tips to Become a …
    Trading psychology refers to the thinking process, mental conditions, and …
  • 9 Reasons Why Most Forex Traders Lose …
    Most Forex traders lose money. You see a warning/disclaimer on …
  • Forex Trade History Report in MT4 & …
    Forex trade history report provides information about your past trading …
  • MetaTrader 4 vs 5: Six Reasons to …
    This article compares MetaTrader 4 vs 5. MetaTrader 4 (MT4) …
  • How to Use MetaTrader 4? A Comprehensive …
    This article is a guide on how to use MetaTrader …

Popular Posts

  • Forex Trade History Report in MT4 & MT5 (A-Z Guide)
    Forex Trade History Report in MT4 & …
    September 4, 2023
  • Top Reversal Candlestick Patterns
    Top Reversal Candlestick Patterns
    December 27, 2022
  • How to Calculate Inflation Using GDP Deflator?
    How to Calculate Inflation Using GDP Deflator?
    October 15, 2022
  • Elliott Wave Theory Guide for Beginners
    Elliott Wave Theory Guide for Beginners
    January 11, 2023
  • What Is GDP? Types, How to Find & Interpretation
    What Is GDP? Types, How to Find …
    October 7, 2022

Srading.com

QUICK LINKS

  • About
  • Cookies Policy
  • Terms & Conditions
  • Disclaimer
  • Privacy Policy
  • Contact Us

LATEST POSTS

  • Trading Psychology: 8 Tips to Become a Better Trader
  • 9 Reasons Why Most Forex Traders Lose Money
  • Forex Trade History Report in MT4 & MT5 (A-Z Guide)
  • MetaTrader 4 vs 5: Six Reasons to Choose MT5
  • How to Use MetaTrader 4? A Comprehensive Guide

FOLLOW US ON SOCIAL MEDIA

  • Facebook
  • Twitter
  • LinkedIn
  • Instagram
  • Pinterest
  • Telegram
  • Reddit
  • YouTube

Trading financial assets are risky. Everything you read on this website is just for educational purposes or personal opinions only. Read our DISCLAIMER!

Copyright © 2023 Srading.com
Call on WhatsApp

Ad Blocker Detected

Our website is made possible by displaying online advertisements to our visitors. Please consider supporting us by disabling your ad blocker.

Refresh