From the Roman era through to the present day, trading is an inherent part of humankind. Buying raw materials when the price is low to resell it when the price is high has been a part of many cultures. In ancient Rome, the rich Romans used the Roman Forum to exchange currencies, bonds, and investments. In the 14th century, traders negotiated government debts in Venice. The earliest form of the stock exchange was created in Antwerp, Belgium, in 1531. Traders used to meet regularly to exchange promissory notes and bonds. The conquests of new worlds entailed a high cost, but also a good return. The Dutch East India Company in 1602 opened their capital for investors to participate in this costly project with a high potential return. During the same time period, a well-known tulip was sold everywhere in the world, creating a profitable market for investors and sellers. A future contract was created for this reason, since many people speculated regarding the price of this flower.
A hundred years later, a French expedition to Louisiana was also attracting many investors, creating the dream of making a lot of money. The Mississippi Company was created to handle all the investments based on potential wealth in Louisiana. Many other investment opportunities arose across the centuries, including the British railroad and the conquest of Latin America.
All these events had a common root: wealthy people willing to make more money. If we want to answer the question Why are we trading?, the answer is to potentially make more money. However, all the previous historical examples ended pretty badly. Investments turned out to be bad investments or, most of the time, the value was over-estimated and traders ended up losing their money. This is actually a good lesson for the readers of this book. Even if trading can sound a profitable business, always keep in mind the ephemeral part of profitability (it can work sometimes, but not always) and also taking into account the inherent risk that goes with investment.