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Saving, Managing Debt, and Budgeting

Investing Versus Speculation

What is the problem with speculating?

When you speculate, you make an investment or buy a stock strictly because you think its price will increase over a relatively short period of time, because of an observed trend or widely held belief. When you invest, you use your fundamental analysis of the inherent value of the asset, believing it will appreciate over time, providing you with a return and the ability to get your principal back at a later date.



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