Despite the terms often being used interchangeably, trading and investing are entirely different methods of generating profit from financial markets, and the choice of which strategy to use depends on personal beliefs, financial goals and analytical methods. Investors tend to focus on the long-term growth of their asset base, while traders prefer to generate as much cash flow in the short-term as possible. Before setting out on your investing journey, you must define which type of trader/investor you are, as there are many different ways to earn a living through financial markets.