What is the difference between investing and speculating?
Here is the doyen of investing, Benjamin Graham expounding on the distinction between these two activities. An investment operation is one, which, on thorough analysis, promises safety of principal and a satisfactory return. Operations not meeting these requirements are speculative that is a very brief reference to speculation. We could amplify it a bit by saying that in speculative operations a successful result cannot be predicated on the processes of security analysis. Speculative operations are all concerned with changes in price. In some cases the emphasis is on price changes alone, and in other cases the emphasis is on changes in value, which are expected to give rise to changes in price. I think that is a rather important classification of speculative operations.
