People trade for several key reasons: to enter and exit markets, to put unneeded cash into investments and convert it back to cash when needed, to exchange one asset for another, to manage risk, and to exploit information about future price movements. Additionally, some people trade because they find it entertaining or as a form of hobby. On a larger scale, trade contributes to increased global efficiency by allowing individuals, businesses, and countries to specialize in activities where they have comparative advantages, which leads to higher productivity, higher living standards, and greater variety and lower prices of goods. Voluntary trade is beneficial as both sides expect to gain value greater than what they give up, making trade a mutually advantageous exchange.
In summary, people trade to gain economic benefits such as specialization, efficiency, risk management, access to better or cheaper goods, and sometimes simply for enjoyment or as a speculative activity.
