A Different Degree of Wealth

What’s the Difference Between Investing and Speculating (and Does it Really Matter)?

The words “speculating” and “investing” often get used interchangeably. And that’s not surprising, since they describe somewhat similar concepts.

In both cases, you are laying out money with the hope of gaining a return in the future.

And to muddy the waters further, marketers are prone to use the words to either cast aspersions on or bring legitimacy to products. “Don’t speculate on the stock market. Instead, invest in these collectible coins.”

Most people will tell you that if you put money into something hoping for a short-term gain, you’re speculating. But if your goal is to realize a gain over the long-term, you’re investing.

Henry Ford described the difference this way: “Speculation is only a word covering the making of money out of the manipulation of prices, instead of supplying goods and services.”1

In other words, you’re not hoping your capital leads to greater output. You’re just hoping the share price jumps.

Lifehacker financial writer Mike Winters says that the difference is more a matter of risk tolerance, with speculation being closer to gambling. “The truth, though, is that there is no clear-cut line between them, as all investing carries risk.”2

So rather than two clearly defined ways of handling your money, speculation and investing are at either end of a spectrum.

At the comparatively lower risk end you may consider instruments like bonds, blue chip stocks, and certain kinds of real estate products. At the higher-risk end you have get-rich-today investments like penny stocks, volatile commodities, and leveraged funds. Each of these has the possibility of a sudden, substantial gain, but also carries a sizeable risk of losing your initial investment.

Winters points out that most people investing for retirement will want to steer somewhere in the middle. To preserve future purchasing power, you’ll need to pursue inflation-beating returns, but you don’t want your nest egg wiped out because of a few bad bets.

“The stock market,” he writes, “(has had) a historical return of roughly 11% per year, on average. The ‘average’ part is important because the longer money is invested the more it will compound, making it less susceptible to short-term, double-digit dips in the market.”

Even more important than knowing whether an investment is low-risk or high-risk, is knowing your own risk tolerance.

Winters concludes, “And since so much depends on your age, financial status, and retirement goals, consider consulting with a financial advisor to walk you through the trade-offs that come with investing and speculating.”

We will not only help you create a long-term plan, and help you understand how your investments are working in concert toward your goal, but we will also hold you accountable to stick to your roadmap when “opportunities,” volatility, and other distractions are tempting you to change course.

Have a wonderful weekend!

Source: Efficient Advisors

Golf Tip of the Week

David Leadbetter’s Secret to Great Putting

Whether it’s a 50-footer across the green or six feet to shoot a new personal best, imagine feeling comfortable and confident over every putt. Now, anyone can become a better putter with a new, simple approach from David Leadbetter. The key? Putting with your core.

To understand what putting with your core means, try this little exercise. Interlace your fingers, clasping your hands in front of you. Then, get into your putting posture, and place your hands over your belly button, your elbows bent outward at 45 degrees. Keeping your lower body quiet, engage your core muscles and use them to rock your arms and shoulders back and forth. This is exactly what the putting motion should feel like when you put a club in your hands.

As Leadbetter is known to say, “The dog wags the tail.” Meaning, if you lead with your core, the arms, shoulders, and club will follow. The bigger muscles move the smaller muscles, not the other way around. Rocking your core will allow you to worry less about your stroke path and keep your arms and hands relaxed throughout the motion. Focus on using your core for a more consistent stroke and better touch on even the most nerve-wracking putts.

Tip adapted from golfdigest.comi

Recipe of the Week

Coconut Cream Pie

10 Servings


  • 1 ready-to-use graham cracker crust
  • 2 boxes (3.4 oz each) coconut cream instant pudding
  • 2 cups half & half milk
  • 1 bar (8 oz) cream cheese softened
  • 1/3 cup granulated sugar
  • 1 carton (8 oz) Cool Whip thawed
  • toasted coconut for garnish


1.In a bowl combine the dry pudding mix powder with the half & half. Stir with a wire whisk until completely combined and creamy. Let it sit for about 5 minutes so it can thicken up. Evenly spread 1½ cups of the pudding into the prepared pie crust (this is the 1st layer). Set aside the remaining pudding.

2.In a separate bowl, combine cream cheese and sugar and beat with a handheld mixer until combined. Fold in the Cool Whip and stir, using a spatula, until completely combined. Add half of this mixture to the remaining coconut pudding mix. Stir together until combined and add to the pie crust (as the 2nd layer).

3.Spread the remaining cream cheese mixture on top (for the 3rd layer) OR you can save this layer and pipe it on top of the pie (like what I did in the pictures) before you serve it. Cover the pie with the enclosed lid from the graham cracker crust and let it refrigerate for at least 8 hours, but preferably overnight.

4.If you saved the 3rd layer pipe that on top of the pie before serving and garnish the pie with toasted coconut.

Toasted Coconut

Heat oven to 325°. Spread 1 cup of shredded sweetened coconut on a cookie sheet and bake for 4 minutes, stir, and bake for another 4 minutes until the coconut is browned and toasted. You may have to cook it for longer until it reaches a light golden-brown color.

Watch it carefully as it can burn very quickly.

Recipe adapted from togetherasfamily.comii

Health Tip of the Week

Need a Pick-Me-Up? Try These Full-Body Yoga Moves for an Instant Energy Boost

Practicing yoga can be an amazing way to soothe stress and promote calm – but it’s also a great way to wake yourself up, boost your mood, and harness a sense of focused alertness. When you’re feeling sluggish or unmotivated, flowing through a few full-body yoga poses can help clear your head and kick your brain and body into gear for whatever you need to tackle next.

Follow this straightforward, energizing yoga flow from Beth Cooke, a yoga teacher and an instructor at Obé – the online destination for streaming live, on-demand workouts from home – for an instant mental and physical boost, any time of the day.

1.         Downward-Facing Dog
2.         Plank
3.         Lunge Salutations
4.         Upward-facing Dog

Tip adapted from realsimple.comiii 

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The views expressed herein are exclusively those of Efficient Advisors, LLC (‘EA’), and are not meant as investment advice and are subject to change. All charts and graphs are presented for informational and analytical purposes only. No chart or graph is intended to be used as a guide to investing. EA portfolios may contain specific securities that have been mentioned herein. EA makes no claim as to the suitability of these securities. Past performance is not a guarantee of future performance. Information contained herein is derived from sources we believe to be reliable, however, we do not represent that this information is complete or accurate and it should not be relied upon as such. All opinions expressed herein are subject to change without notice. This information is prepared for general information only. It does not have regard to the specific investment objectives, financial situation and the particular needs of any specific person who may receive this report. You should seek financial advice regarding the appropriateness of investing in any security or investment strategy discussed or recommended in this report and should understand that statements regarding future prospects may not be realized. You should note that security values may fluctuate and that each security’s price or value may rise or fall. Accordingly, investors may receive back less than originally invested. Investing in any security involves certain systematic risks including, but not limited to, market risk, interest-rate risk, inflation risk, and event risk. These risks are in addition to any unsystematic risks associated with particular investment styles or strategies.

The articles and opinions expressed in this newsletter were gathered from a variety of sources but are reviewed by Ballentine Capital Advisors prior to its dissemination. All sources are believed to be reliable but do not constitute specific investment advice. In all cases, please contact your investment professional before making any investment choices.  Past performance does not mean future gain.

Advisory services through Ballentine Capital Advisors, Inc.


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