"What is the difference
between investing and speculation? At first, you think the answer is simple
because the distinction is obvious — that is, until you actually put pen to
paper and try to answer the question.
Go ahead; take a few seconds
and think about it. Write down “investing.” Now write the definition. Do the
same for “speculation.” If you are like me, frustration quickly builds because
the answers do not come quickly or easily, and they should. After all, these
terms have been a part of the financial lexicon since Joseph de la Vega
wroteConfusion of Confusions in 1688, the oldest book ever written on the stock
exchange business. In his famous dialogues, de la Vega observed three classes
of men. The princes of business, called “financial lords,” were the wealthy
investors. The merchants, the occasional speculators, were the second class.
The last class was called the “persistent speculators” or the “gamblers.”
(...)"
