The Difference Between Speculation and Investment

"...investment is buying a security at a price that is associated with a reasonable expectation of acceptable long-term returns. Speculation is buying a security in the expectation that its price will advance, with less regard for long-term prospects. Both benefit from solid valuation methods and reliable measures of market action, but investment weighs valuation more strongly, while speculation weighs market action more strongly. The problem for active market participants is to distinguish between investment and speculation in the first place, and then to identify good and bad opportunities to accept such positions." John Hussman, Phd.