Mastering Blockchain - Second Edition

Trading

A market is a place where parties engage in exchange. It can be either a physical location or an electronic or virtual location. Various financial instruments, including equities, stocks, foreign exchange, commodities, and various types of derivatives are traded at these marketplaces. Recently, many financial institutions have introduced software platforms to trade various types of instruments from different asset classes.

Trading can be defined as an activity in which traders buy or sell various financial instruments to generate profit and hedge risk. Investors, borrowers, hedgers, asset exchangers, and gamblers are a few types of traders. Traders have a short position when they owe something, in other words, if they have sold a ...