An individual who allocates money or capital with the expectation of earning a profit. Investors are willing to put their capital at risk to potentially receive a higher return than a risk-free security. Investors generally have a longer-term time horizon than speculators. Investors also tend to seek investments that are more likely to return principal, whereas speculators seek high-return investments, which are oftentimes subject to greater risk of principal. In other words, risk versus reward.