What financial trading means
Trading is the act of buying and selling financial instruments — such as currencies, stocks, commodities, or crypto — with the goal of benefiting from price changes. You are exchanging one asset for another at an agreed price, usually through a broker or exchange.
Trading is not the same as long-term investing. Investors often hold assets for months or years. Traders typically hold positions for minutes, hours, or days, reacting to shorter-term price movement.
Key ideas
- Every trade has two sides: someone buying and someone selling.
- Prices move because supply and demand change.
- Most retail traders use margin/leverage — this increases both potential gain and potential loss.
Educational note: Trading involves substantial risk. Past price behaviour does not guarantee future results. This lesson is for learning only — not financial advice.