Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
What constitutes trading according to tax law
Expert Solution
Step 1
Trading involves healthy participation in the financial markets in comparison to investing which works on a buy and hold strategy. The success of trading is dependent on the ability of a trader to be profitable over a period of time.
A trader is an individual who gets involved in buying and selling of a financial asset in any financial market. An individual can buy either for oneself or for some other individual.
A difference between an investor and a trader is the time period for which an individual holds an asset.
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