Trading is not a new concept. Trading can be seen in all aspects of life over time. Whether it's a kid in an elementary school, trading a bag of chips for a cupcake, or going back two thousand years and Native Americans trading with the Pilgrims. The concept of international trade is also not new, but it has as many advantages as disadvantages. One of the many advantages of international trade is having foreign direct investments (Investopedia, Foreign Direct Investment). “Foreign direct investment, or the amount of money individuals invest in foreign companies and other assets (Investopedia, foreign direct investment).” When there is foreign direct investment, economies have the opportunity to grow and compete with other economies. When a country is stimulated by foreign direct investment, it can experience an increase in employment, and due to the increase in the level of employment, the gross domestic product will also grow (Investopedia, Foreign Direct Investment). Foreign direct investment can also help stabilize volatile markets (OECD iLibrary). Foreign direct investment can also be important in helping the development of foreign markets (OECD iLibrary). Foreign direct investment can occur in several ways. The domestic market could purchase shares of a foreign company or it could merge with the foreign company (Investopedia, Foreign Direct Investment). One of the most important aspects of international trade is the creation of free markets (Advantages of Free Trade, Fronding). A free trade market can be defined as “a group of countries that invoke little or no price controls in the form of tariffs or quotas among themselves ( Investopedia, Fre...... middle of paper ...... By It is usually measured over the long term and this is due to impacts that occur over time (Investigative Responses). Political risk can occur for multiple reasons, including currency valuation, salary levels and labor laws (Investigative Responses). Even events that can cause political risk, such as wars or civil unrest, events like these can cause political risks that make trading internationally difficult (investigate answers) Political risk can reduce investment returns when trading internationally , but some of these losses can be covered by some insurance forums (political risk). Although there are some disadvantages to international trade, it seems that the benefits outweigh the disadvantages. Because of the benefits created by international trade, there will always be international trade in free economies.