Help:Trade

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Basics

The trade system rests on two pillars: Warehouses and Caravans. In its basics, it is incredibly simple: Warehouses store goods in a region, Caravans allow goods to be moved anywhere.

Caravans

Caravans are a paraphernalia, but don't require soldiers to operate (they bring their own men). As such, it is absolutely feasable to be a peaceful trader with no unit attached.
Owning at least one caravan will allow you to buy and sell goods. Trading itself is easy: Buy a few caravans, buy some goods somewhere, travel somewhere else, sell goods, repeat. Of course, profitable trading is much more difficult.
Once you own at least one caravan, you can go to the Actions page to do some trading.

Warehouses

The other part of the trading system are warehouses. Each region has a warehouse where the various goods are stored. Of course, in most regions this will not really be a single physical building, but a multitude of grain stores, warehouses, storages, etc.
The warehouse is what traders deal with. They buy and sell at the local warehouses, which are controlled by the realm rulers and/or region commanders, who set the buy and sell prices. There are realm-wide default prices set by the ruler, but individual regions can have different prices.
Warehouses have unlimited storage capacity, but require a bit of upkeep to keep running, and this upkeep depends on the total amount of goods stored and will be substracted from the regions tax income. Therefore, it does not make economic sense to store too much of a surplus.

Each warehouse also has ox carts that it usually uses to move goods to and from the markets, or from the production places (mines, fields, etc.) into the warehouse proper. These ox carts can also be used to move goods to neighbouring regions (only if they belong to the same realm) if thus instructed by the realm ruler or region commander. However, this transport is slow, taking about twice as long as a trade with his caravans would.