Trading Assets: Complete Guide to Financial Instruments 2025

1. Forex (Foreign Exchange)

The forex market is the largest and most liquid financial market globally, with daily trading volume exceeding $7.5 trillion according to the Bank for International Settlements (BIS) 2022 Triennial Survey. Forex trading involves buying one currency while simultaneously selling another, expressed as currency pairs like EUR/USD, GBP/USD, and USD/JPY.

Currency pairs are categorized into three groups: major pairs (involving USD), minor pairs (cross-currency without USD), and exotic pairs (emerging market currencies). Major pairs account for approximately 80% of forex trading volume due to their high liquidity and tight spreads.

The forex market operates 24 hours a day, 5 days a week, across four major trading sessions: Sydney, Tokyo, London, and New York. This continuous operation allows traders to react to global economic events and news releases in real-time.

Forex Trading with Prop Firms

Many prop trading firms specialize in forex trading. Firms like FTMO, FundedNext, and MyFundedFX offer funded accounts for forex traders with funding up to $400,000. These firms typically provide access to MetaTrader 4, MetaTrader 5, or cTrader platforms for forex execution.

Forex trading involves analyzing currency pair movements across global markets.

Stock exchanges like NYSE and NASDAQ facilitate equity trading for publicly listed companies.

2. Stocks (Equities)

Stock trading involves buying and selling shares of publicly traded companies on exchanges like the New York Stock Exchange (NYSE), NASDAQ, London Stock Exchange (LSE), and Tokyo Stock Exchange (TSE). When you purchase stock, you acquire partial ownership in a company and can profit from price appreciation and dividends.

Stocks are categorized by market capitalization: large-cap (over $10 billion), mid-cap ($2-10 billion), and small-cap (under $2 billion). They're also classified by sector including technology, healthcare, financials, consumer discretionary, and industrials.

Unlike forex, stock markets have defined trading hours. The NYSE operates from 9:30 AM to 4:00 PM EST, with pre-market (4:00-9:30 AM) and after-hours (4:00-8:00 PM) sessions available through some brokers.

Stocks and Prop Trading

Some prop firms offer stock trading, though it's less common than forex or futures. Firms specializing in stocks often focus on US equities through platforms compatible with direct market access (DMA). Check our guide on prop firms that trade stocks for detailed options.

3. Futures Contracts

Futures trading involves standardized contracts obligating the buyer to purchase, or the seller to sell, an underlying asset at a predetermined price on a specific future date. Futures trade on regulated exchanges like the Chicago Mercantile Exchange (CME), Intercontinental Exchange (ICE), and Eurex.

Popular futures contracts include E-mini S&P 500 (ES), Micro E-mini Nasdaq (MNQ), Crude Oil (CL), Gold (GC), and Euro FX (6E). Futures offer significant leverage—E-mini S&P 500 requires approximately $13,200 initial margin to control a contract worth over $250,000.

Unlike forex, futures have specific contract expiration dates (monthly or quarterly). Traders must roll positions to new contracts before expiration or settle. The CME Globex platform enables nearly 24-hour trading for most futures contracts.

Futures Prop Firms

Futures prop firms are among the most popular in the industry. Leading firms include Apex Trader Funding, TopStep, and My Funded Futures. These firms offer funded accounts up to $300,000 with 90% profit splits and access to CME, CBOT, NYMEX, and COMEX contracts.

Futures contracts trade on regulated exchanges with standardized specifications.

Commodities include precious metals like gold, which serves as a traditional safe-haven asset.

4. Commodities

Commodity trading involves buying and selling raw materials and primary products. Commodities are categorized into four groups: precious metals (gold, silver, platinum), energy (crude oil, natural gas), agricultural (wheat, corn, soybeans, coffee), and industrial metals (copper, aluminum).

Commodities can be traded through futures contracts (most common), ETFs, CFDs, or physical ownership. Gold (XAU/USD) is particularly popular among forex traders and is offered by most prop trading firms alongside currency pairs.

Commodity prices are influenced by supply and demand dynamics, geopolitical events, weather patterns, currency movements, and economic indicators. For example, crude oil prices react to OPEC production decisions and global economic growth forecasts.

5. Cryptocurrencies

Cryptocurrency trading involves digital assets secured by cryptographic technology. Bitcoin (BTC), Ethereum (ETH), and thousands of altcoins trade 24/7 on exchanges like Binance, Coinbase, Kraken, and decentralized platforms. The crypto market has a total capitalization exceeding $2 trillion as of 2024.

Cryptocurrencies are characterized by extreme volatility—Bitcoin can move 5-10% in a single day. This volatility creates significant profit opportunities but also substantial risk. The market operates continuously, including weekends and holidays.

Trading methods include spot trading (buying actual coins), futures and perpetual contracts, options, and CFDs. Leverage in crypto can reach 100x or higher on some platforms, though this dramatically increases risk.

Crypto Prop Trading

Several prop firms now offer cryptocurrency trading. Crypto prop firms provide funded accounts for Bitcoin and major altcoins trading. Firms like E8 Markets and some divisions of FundedNext support crypto pairs alongside traditional forex.

Cryptocurrency markets operate 24/7 with significant volatility and profit potential.

Indices like the S&P 500 track overall market performance across multiple stocks.

6. Indices (Stock Indices)

Index trading provides exposure to entire market sectors or economies through a single instrument. Major indices include the S&P 500 (500 largest US companies), NASDAQ 100 (tech-focused), Dow Jones Industrial Average (30 blue-chips), DAX 40 (Germany), and FTSE 100 (UK).

Indices cannot be traded directly—traders use derivatives including index futures (ES, NQ), CFDs, ETFs (SPY, QQQ), and options. Index trading offers diversification benefits since you're trading a basket of stocks rather than individual company risk.

Index movements reflect overall market sentiment and economic conditions. They're influenced by earnings reports, economic data releases, Federal Reserve decisions, and global events. Many traders use indices as leading indicators for broader market direction.

7. Bonds (Fixed Income)

Bond trading involves debt securities issued by governments and corporations. When you buy a bond, you're lending money to the issuer in exchange for periodic interest payments (coupon) and return of principal at maturity. The global bond market exceeds $130 trillion in outstanding debt.

Bond categories include government bonds (US Treasuries, UK Gilts, German Bunds), corporate bonds, municipal bonds, and high-yield bonds. Bond prices move inversely to interest rates—when rates rise, bond prices fall.

Traders access the bond market through direct purchases, bond futures (Treasury futures on CME), bond ETFs (TLT, BND), and CFDs. Bond trading is generally less volatile than stocks or forex but requires understanding of yield curves, credit ratings, and monetary policy.

Bonds provide fixed income returns and are considered lower-risk than equities.