I tend to compare investing vs speculation to owning a farm. A speculator is more concerned about how much the farm’s acreage is worth on a day to day basis. A speculator will try to ascertain the prices of farmland in his area daily to see if he can resell his land at a higher price. An investor owning a farm could care less about the changing values of the farms acreage. The investor is more concerned about how much wheat,soybeans,or corn the farm can produce every year. This example displays everything you need to know about the difference between an investor and a speculator. An investor is more concerened about how much a farms acreage will produce while a speculator is more concerned about how much the farms acreage will sell for tommorow.
When investing in the stock market one must follow the rules of an investor who buys a farm. Buy companies for their assets and collect the cash that those assets produce. The asset is your farm and the free cash flow,dividends,and stock buybacks is your wheat,soybeans and corn.