Trading is an active style of participating in the financial markets that seeks to outperform traditional buy and holding investing. Rather than trying to profit from long term uptrends in the market, traders look for short-term price moves to profit in both rising and falling markets.

An investment strategy is an investors plan of attack to guide their investment decisions based on individuals goals, risk tolerance and future needs for capital. The components of most investment strategies include asset allocation, buy and sell guidelines, and risk guidelines.