You may not realize it, but international trade shapes your day-to-day life. The shoes you buy, the coffee in your morning cup, the technology that powers your smartphone — chances are many of these items came from different parts of the world. But international trade doesn’t just stock shelves, it also impacts the economy in ways that trickle down to your livelihood (and portfolio). Whether it’s through price changes at the grocery store or the profitability of the stocks you hold, international trade plays an integral role in financial markets and personal wealth. Let’s explore how international trade works and factors into your life. The Basics of International Trade In the simplest terms, international trade is the exchange of goods and services between countries. By engaging in trade, nations can capitalize on their strengths (known as comparative advantages) and access products or resources they don’t naturally possess to satisfy consumption needs. For example, Colombia is a major exporter of coffee beans because of an ideal climate, while China routinely dominates electronics manufacturing thanks to cost-effective production and labor. These are comparative advantages. On the other