• What is Trading
  • Forex Market
  • Equity Market
  • Commodities Market
  • Derivatives Market

What is Trading?

  • It’s been there ever since man started painting symbols on cave walls and realized that in exchange for an arrowhead he could get paint
  • Since goods were first exchanged between people thousands of years ago, trading has been a great way of making profits
  • People started trading everything – real estate, cattle, sugar, cotton, gold, oil, food, clothes, weapons, technology, even art
  • Today even trading money for money is possible. Moreover, anyone can do it online, at any time and from anywhere
  • The financial market is the place where financial assets such as stocks, bonds, currencies and commodities are traded

Why People Trade

  • Some people are motivated to trade because they expect to gain a profit on their investment – we call them speculators
  • Speculators try to anticipate price movements and trade to make a profit by buying low and selling high
  • Some other people are motivated to trade in order to manage their risk – we call them hedgers
  • Hedgers trade in order to protect an asset they already have like the farmer who sells his crop before the harvest season
  • Besides trading to save, manage risk, and speculate some people trade simply because they find it challenging



Financial Markets

  • Financial trading all over the world takes place, either through a regulated centralized exchange or over the counter
  • “Exchange-traded” markets operate via a centralized exchange such as the NYSE, LSE, TSE, and many more around the world
  • OTC markets are decentralized markets made up of networks of different dealers who compete to link buyers to sellers
  • The foreign exchange or forex market – where you can buy and sell currencies like the euro and the dollar
  • The equity or stock market– where you can buy and sell shares of companies like Apple, Facebook and Ali baba
  • The commodities market – where you can buy and sell commodities like gold, oil, grains, sugar etc
  • The bond or fixed income market – where you can lend money to governments or corporations
  • The derivatives market – where you can trade financial contracts that obtain their value from an underlying asset


The Forex Market

  • The foreign exchange or forex market, is the financial market where currencies are traded or exchanged for one another
  • Biggest market in the world with an average volume exceeding 5 trillion dollars per day operating 24/5 from Monday to Friday
  • The foreign exchange market is an OTC market used by Individuals, financial institutions, businesses, governments…
  • Foreign exchange transactions occur because of international trade, tourism, borrowing and lending and speculation
  • Today most currencies are freely floating and their price is determined based on the demand and supply of each currency


Equity Markets

  • The equity market or share market is simply the place where shares or stocks are traded
  • Shares are financial assets that provide evidence of ownership in a company and hence a share in its profits
  • Shares of publicly listed companies like Apple and IBM are traded in a stock exchange like the New York Stock Exchange
  • If the company is profitable at the moment and expected to make more profits in the future the price of the share will rise
  • If the company is not profitable at the moment and is not expected to make future profits, its share price will drop

Commodities Market

  • The commodities market is the place where raw materials instead of manufactured goods are traded
  • Agricultural commodities – grains, food and fiber like corn, soybeans and cotton but also livestock and meat like cattle
  • Energy commodities – crude oil, brent oil, ethanol, natural gas and propane
  • Metal commodities – industrial metals like copper, lead and zinc and of course precious metals like gold and silver


Fixed Income Markets

  • The bond market or fixed income market is the place where investors and traders trade debt and securities
  • It is the market where borrowers that have shortage of cash, meet with investors that have surplus of cash
  • The main issuers of bonds are governments, semi government institutions like municipalities and corporations like IBM
  • When you buy a bond, you are lending the issuer money and they promise to pay you back in full, with interest in the future

Derivative Markets

  • Is an instrument whose value depends on – is derived from – the value of some other instrument, called the underlying asset
  • For example, oil derivatives derive their value from the value of oil in the oil market
  • Derivatives are divided into two categories based on the asset they derive their value from
  • Commodity derivatives are based on commodities – energy contracts derive their value from commodities like oil and gas
  • Financial derivatives are based on financial instruments – stock and index contracts derive their value from the stock or index

Types of Derivatives

  • Futures – a standardized contract to buy or sell an asset at a pre-determined price, at a specified date in the future
  • Options – a contract that gives the holder the right to buy (call option) or sell (put option) a security at a specified price
  • Contract for Difference (CFD) – a derivative contract used as a speculative tool against changes in the value of an underlying asset
  • Financial derivatives have many benefits such as margin trading, going long and short, and some being tax exempted
  • Margin trading however as in all cases can increase both the profit potential but also the risk so must be used wisely





The Story of Desmond Leong

Desmond is your average trader. He started off blowing up 7 (or more.. lost count) accounts amounting to more than 500k, tested over 30 Expert Advisors (EAs) to no success and spent over 10k on stupid useless courses.

Today he runs an award winning trading team and provides market analysis and webinars to some of the largest brokers such as IC Markets, XM, Axi, Tickmill, FXCM, VantageFX, easyMarkets and more.

He now has a simple goal: Creating an army of traders who trade profitably together and keep each other accountable. Guiding them with the most comprehensive no-BS free tutorials so that no one ever needs to go through the pain he went through himself to become a profitable trader.

My Trading Strategy


11 Collyer Quay
The Arcade
Singapore 049317


(t) +65 9336 1245
(e) hq@theforexarmy.com

All rights reserved. All other trademarks appearing on this Website are the property of their respective owners.

© Copyright TFA GLOBAL Pte. Ltd.


Trading in foreign exchange (“Forex”) on margins entails high risk and is not suitable for all investors. Past performance is not an indication of future results. In this case, as well, the high degree of leverage can act both against you and for you. Before you decide to invest in foreign exchange, you should carefully assess your investment objectives, experience, financial possibilities and willingness to take risks. There is a possibility that you will lose your initial investment partially or completely. Therefore, you should not invest any funds that you cannot afford to completely lose in a worst-case scenario. You should also be aware of all the risks associated with foreign exchange trading and contact an independent financial advisor in case of doubt.

Trading Derivatives carries a high level of risk to your capital and you should only trade with money you can afford to lose. Trading Derivatives may not be suitable for all investors, so please ensure that you fully understand the risks involved and seek independent advice if necessary.

Leverage enables traders, using a relatively small amount of money, to take a position that is many times the initial investment. This leverage effect can work both in your favour and to your detriment. The Forex market opens up the possibility to utilize this leverage effect to a high degree; at the same time, however, it also opens up the risk of experiencing high losses. Please trade with caution when you use leverage in trading or investing. Your risk is particularly not limited to the initial investment, but can quickly fall into a negative range in the event of strong movements, meaning you may be obligated to pay far more than your initial wager.