What it means
Each behaves differently: when it trades, how far it moves and what pushes it around. Futures are contracts that follow these assets, not a class of their own.
In practice
Knowing the asset class tells you the practical things before you place a trade: the hours it trades, the size of a typical day's move, what it costs to trade and which news moves it. A stock reacts to its company's earnings, a currency pair to interest rates, and crypto to sentiment and liquidity around the clock.
Most traders do better by learning one or two classes well than by jumping between all of them. A setup that works on an index future in the New York morning can behave very differently on a thin altcoin at the weekend.
What to watch for
Assets in different classes can still move together. In a broad sell-off, stocks, crypto and commodities often fall at the same time, so holding several of them is not automatically spreading your risk.
Related terms
4 terms- StockA small piece of ownership in a company, traded on an exchange.
- ForexTrading one currency against another, quoted in pairs like EUR/USD.
- CommodityA raw material such as gold, oil, silver or wheat, usually traded through futures or CFDs.
- CryptocurrencyDigital assets like Bitcoin and Ether that trade on crypto exchanges 24 hours a day, 7 days a week.