Market Foundations

How markets price, how positions and orders work, and how much to risk on one trade. The base layer everything else sits on.

Written for

New traders who need market mechanics and a working risk framework before anything else.

Length

6 lessons · 60 min

1. 1How financial markets workPrice is the point where buyers and sellers agree. Everything else follows from that.10 min · beginner
2. 2Long and short positionsBoth directions are available in every market covered here. The risk profiles are not symmetric.9 min · beginner
3. 3Bid, ask, spread and liquidityEvery position starts at a small loss. The size of that loss is a cost you control through timing and instrument choice.9 min · beginner
4. 4Orders and executionFour order types cover almost every situation. The choice between them decides whether you control price or control certainty of fill.10 min · beginner
5. 5Leverage and marginMargin is what a position requires as collateral. Leverage is what it does to the size of your mistakes.10 min · beginner
6. 6Position sizing and risk per tradeThe one calculation to run before every position. It converts a stop distance into a size, rather than picking a size and hoping.12 min · beginner