The Intrinsic Ownership test
A simple way to separate investing from speculation:
Ask yourself, "If I owned 100% of the asset and resale markets disappeared, would it still have value?"
Yes: it’s an investment.
No: it’s speculation.
The key idea is that value must exist independent of resale. Ownership and control should confer:
\-cash flow
\-utility
\-productive use
\-enforceable rights
If an asset only has value because someone else might buy it later, then returns depend on a greater fool, not ownership. Basically, another way to look at the Greater Fool theory.