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A professional investor is someone who purchases various types of commodities with the intention of reselling them for a profit. This type of description could easily apply to businessmen who purchase everything from stocks and bonds to vintage automobiles or baseball cards, which is why there are professional investors within many types of industries. The daily operations of a professional investor can drastically vary, but it normally includes speaking with clients and sellers, studying their investment field of choice, and determining the proper times to either buy or sell commodities.
One of the biggest aspects of being a professional investor is having a thorough understanding of the market. If a professional investor dealt in collectible coins or modern art, for example, it would be essential for that person to understand the market trends and be in a position to buy or sell whenever necessary. While some would mistakenly believe that the purchasing price would play a critical role in determining a sound investment, a professional investor focuses more on the difference between the buying price and the actual worth. In some markets, this figure could vary by as much as 100%, depending on the overall knowledge of the seller.
Many of the professional investment fields are designed to take advantage of the earliest barter systems found throughout the world. While any given item may have little worth to one individual, a professional investor will have a network of clients that are seeking certain commodities in many different areas. When one of the sought-after items is discovered by the investor, a selling price with his client is often negotiated before it is even purchased from the original owner. This allows the professional investor the opportunity to provide value to the client while guaranteeing a profit for himself, so in essence, everyone wins.
Other types of professional investors deal with commodities that have a fixed price that is determined by an authoritative organization, which makes speculation and knowledge of the market that much more important. A stock broker faces these types of challenges each and every day, and the top professionals are able to determine which investments are most likely to rise or fall within the near future. The exact same principles would apply to a professional investor that traded in precious metals and stones; clients hire him for his abilities to outguess the true value of these items in advance.