What is short term long term & Medium term in investment ?

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 What is short term long term & Medium term in investment?

Investment Horizons:

  1. Short-Term:
    • Duration: Less than 1 year (often 3 to 12 months).
    • Purpose: Quick returns, capital preservation, or meeting near-term financial goals.
    • Instruments: Savings accounts, liquid funds, short-term bonds, ultra-short-term mutual funds, or blue-chip stocks with low volatility.
    • Risk & Returns: Typically lower returns and lower risk, though short-term equity trades can be volatile.
  2. Medium-Term:
    • Duration: 1 to 5 years (sometimes 3 to 7 years, depending on context).
    • Purpose: Building wealth for medium-term goals like buying a car, funding a child’s education, or accumulating capital for larger investments.
    • Instruments: Balanced mutual funds, blue-chip stocks, medium-term debt funds, REITs, or conservative equity portfolios.
    • Risk & Returns: Moderate risk and moderate returns, aiming for growth with some protection against downside risks.
  3. Long-Term:
    • Duration: More than 5 years (commonly 7 to 20+ years).
    • Purpose: Wealth accumulation, retirement planning, legacy creation, or meeting large financial goals like buying property.
    • Instruments: Equity mutual funds, diversified stocks, index funds, ETFs, PPF (Public Provident Fund), and long-term bonds.
    • Risk & Returns: Higher risk, but also higher potential returns, especially when investing in equity. Long-term investments benefit from compounding and market cycles.


Trading Horizons:

  1. Intraday (Short-Term):
    • Trades are opened and closed on the same day.
    • High risk, high reward, requires constant monitoring.
  2. Swing Trading (Short to Medium-Term):
    • Duration ranges from a few days to weeks.
    • Traders aim to capture short- to medium-term market movements.
  3. Positional Trading (Medium to Long-Term):
    • Duration is weeks to months, sometimes extending to a year or two.
    • Requires identifying long-term trends while managing risk in the short term

Hope now you must be clear by your thoughts so define you investing & trading 
Journey 

Wise investing 
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