Market and product

The thing being bought and sold is a product, and the place where hundreds of buyers and hundreds of sellers meet over the same product at the same time is a market. Whether the record belongs to a metal, a share of a company, the ratio between two countries' money or an asset that exists only digitally, it holds the same two things: a number and a time. The industry also calls these products instruments. A record never tells you the product's name, what it is for or who sold it — which product you are looking at is something you always have to know from outside. The common misreading is to confuse the size of the numbers with value: a product reading 12 and one reading 40,000 measure different things and cannot be compared. The reading you learn is identical for every product; but starting to read without knowing which market and which product is in front of you breaks the first rule of risk literacy before a single number has been read.

This content is educational information, not personalised investment advice. The chart examples are illustrative.

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