It has been some time since i killed some foreign traders, but i recently wiped out 2 bands without becoming seriously injured or losing an eye. I've since switched up my strategies and taken advice from others, and ill clarify what worked with my old strategy and what did not.
1. Companions are unnecessary
Fighting in groups has its upsides, but its not a necessity. While dogs and hired arms are very powerful, they are both in limited supply. If you're going hardcore combat, looking to wipe out everything in your path from villagers, Njerps, and Traders, go ahead. However, I've had decent success with fighting foreign traders alone. Still, adventurers in the wild are not in limited supply, so if you have the food and weapons to spare (which you likely will if you've wiped out bands in the past), go for it. However, remember that group fighting makes hit-and-run tactics a little wasteful, since you're effectively sacrificing your companion (unless its a leashed animal).
tl;dr: fighting alone is still very much a valid tactic against foreign traders
2. Full Metal Armor vs. Fur and Leather
Previously, I never tried using non-metal armour when fighting humans, especially foreign traders. However, I now understand that slowly (and painfully slowly) gathering metal armour pieces from trading and killing is not necessary.
As mentioned before, full metal armour imposes a weight penalty of 10% to 15%. Its good for deflecting blows, but the hefty penalty affects your weapon skills, especially your bow (or crossbow) skill which you definitely need in hit-and-run tactics. Furthermore, when I did fight with metal armour, which was usually fighting 3 to 4 at once at a bottleneck in a forest, i find they almost always get a lucky hit into the eye, and while not immediately fatal, blood loss can kill quickly when fighting against a mostly alive group, and you'll be out of commission from the battlefield for days or weeks.
However, while fur and leathers still leave you somewhat vulnerable against usual weapons, they impose less weight penalties. Plus, if you're wearing furs and leathers, you definitely should not try to fight a band of skilled enemies like foreign traders and Njerpez head on. Furs and leathers can skill deflect blows, or at least reduce the severity of the blows. Plus, I believe you can run more (and maybe faster?) with lighter armour, which makes a great case for hit-and-run tactics.
Besides being able to run faster, less penalties means your counter attacks will be more successful, crucial if your weapon skill is higher than your dodge skill. It is also important when your weapon inevitably slips out of your grasp. Less penalties on your dodge stat means that you just might stay intact while picking up and wielding your weapon again.
Currently, I am running some wool armour with leather boots, leggings, and forearm guards with mail mittens, long mail cowl, and a spectacle helm. So far, I have only a few injuries and more than 10 FT kills on my back.
3. Scouting is important.
Unlike bandits, foreign traders are friendly at first. Scout amongst the group to identify the archers, and the ones with weapons with higher attack bonus (battle swords, masterwork spears, battle axes). If you are able to, trade their arrows away, you can bring some mediocre furs and trade them for their bows or arrows to disarm some traders, though they may not always have their bow and arrows for sale. If a foreign trader has a bow and arrow he will not sell, and is the only one to not sell, he will be your first target.
This is also a good chance to understand what you are up against, if you feel that you cannot confidently beat the foreign traders, retreating is always an option. And once you have finished scouting:
4. Formulate a Battle Plan
Pick out the one you want to take out first and stalk them. Wait for them to stray away, and circle them up close. As mentioned before, the archers must die first. Too many times have I been crippled or killed by a lucky shot. Afterall, you need to get lucky over 10 times, they need one lucky shot and its over.
Take advantage of the natural environment to find a set of trees that not only allows you to do one on one combat, but also prevent them from flanking you. Trees can also stop arrows before they hit you, and spruce trees outright block line of sight, keeping you safe from archers (but also putting ranged users at a disadvantage).
You gain a huge advantage if you attack any entity that is facing away from you, and will have a good chance (likely, but not guaranteed) to kill your foe in one hit if you aim for the head with a high skill level in your weapon.
Though not necessarily part of the battle plan, I recommend going for their legs as they will waste turns trying to get up, and you will be at a speed advantage if they attack from the ground (you can attack faster than they do). This can be used against multiple opponents too, just counterstrike aim their legs and they should stumble and fall.
5. The battle itself, and what to do
The opening move is what starts and decides the fight, especially since Foreign Traders let you get up close before you attack them. There are 2 main opening moves I've used:
a. Long Range Harassment
This strategy must be done with a higher speed character, and you must have a clear (explored) patch of land you can turn around and run to.
Simply shoot at a foreign trader (they dont become hostile until you actually hit them) with some arrows. If you have a heavy crossbow, it will likely be able to weaken, cripple, or even kill one. If you have a bow, you can take multiple shots before running. I would recommend using a long bow to maximize the distance between you and the foreign traders.
Your goal is to land a shot that makes them walk lame, limp, crippled, or unable to walk. However, when they come within 20 to 25 tiles of you, turn tail and run into the woods. Once you've reached 25 to 35% fatigue, turn around and see if theyre still chasing. If they arent, sneak and go back. Once your fatigue is at 0%, repeat until the well armed or most of them are crippled. This will take a long while; alternatively;
b. Assassinate and hit-and-run
As mentioned before, hitting an enemy when they're looking away means they cant defend against it. So, an attack to the head is likely to hit. While it will not kill in 1 attack most of the time, a devastating hit to the head or upper-body can easily be followed up by another. In my experience, foreign traders don't immediately turn around after you've attacked them. With a masterwork battle axe (which I ironically bought from the first band of traders I wiped out), I am usually able to knock out a foreign trader facing away from me in 2 to 3 hits, and 1 or 2 blows to the neck to kill him.
However, if the rest are getting closer, leave the enemy unconscious and run. Usually, this will not be an issue if you have managed to stalk and follow your first target as he strays far enough away so that most of his companions are off-screen or on the edge.
Once you've killed the archer or most dangerous one, you must loot his arrows and powerful weapon even if you aren't skilled in them. You don't want his companions picking up a bow and arrows and shooting you as you run away.
When you've managed to escape them, and they aren't aggressive anymore, go back, circle them, single one out and shoot them with arrows until theyre crippled. It's best to target a trader that you know has once again strayed away from his group, this way, the rest will tire themselves out as they run to you.
If you see that most of the traders are fatigued (using the l key to use the look function, click on creatures to see their stamina), let them come within 25 to 35 tiles, unwield your bow and hold your melee. Back away and shoot. Fatigued enemies are slower, so you will be able to land more shots. Once they are within 15 tiles, and you've injured them, unwield your bow, wield your battleaxe, and start picking fighting them upclose. With a master or grandmaster combat skill, a mostly unfatigued (<20% fatigue) and mostly uninjured (<15% injury) player can counterattack a breathless or very fatigued enemy without issue, especially when they're injured.
6. Shields and weapons
Ranged-Weapons
The best ranged weapons in terms of long range accuracy are the heavy crossbow and long bow. Long bows are surprising cheap, priced at 20 blunt arrows (or 10 arrows). Long bows are (usually) better than the heavy crossbow for group fighting, but the heavy crossbow with its monstrous 9 damage per shot(one of the highest, if not the highest weapon damage values in the game tied with the battle axe), can seriously injure a foreign trader with 1 shot. Personally, I prefer the long bow as it allows for spamming shots.
Melee-Weapons
The best melee weapons in the game are the battle-axe, battle sword, spear, and Kaumo spear.
The battle-axe is a 2 handed axe with an Edge damage value of 9, which is as far as I know the highest in the game, followed by the battle sword at 8. As it is an edged weapon, it can cause bleeding wounds. It has an attack bonus of 4, which is on par with a spear, but 1 less than the battle sword and kaumo spear.
Attack bonus gives you an advantage or disadvantage in battle, best presented by the length of the weapon. This means, against a battlesword or a kaumo spear, battleaxes are at a disadvantage. However, foreign traders don't use kaumo spears, so the ones you have to look out for are the ones with battle swords.
The battle sword is a 2 handed sword with an Edge damage value of 8 and an attack bonus of 5. Like the battle axe, it can cause bleeding wounds since it is an edged weapon.
Spears and kaumo spears are both 2 handed weapons. The spear has a point damage value of 7, while a kaumo spear has 8. Similarly, spears have an attack bonus of 4, while kaumo spears have an attack bonus of 5. When using their point attack, they do not cause bleeding wounds.
So, what is best?
Depends on what skill you are highest at. However, (unpopular opinion) battle swords and battle axes are more useful in combat since they cause bleeding wounds. Bleeding wounds do not impose a penalty, but they will eventually kill. This allows you to leave an unconscious enemy to die in his sleep if you need to run away.
Furthermore, bleeding comes in handy when you are backing away against 2 not-yet fatigued foes. Not all fights and plans are perfect, and often, you'll find yourself against 2 traders that are close but not yet fatigued. Bleeding wounds allow you to let their condition worsen as you back away to force a 1 on 1 and counter attack.
Still, in character creation, since Kaumo tribes (highest strength and endurance) usually get high spear skill bonuses, a spear is still a very effective weapon.
Shields
Shields will slow you down, but block missiles, arrows, and blows. However, just because it can do this, does not mean you must use it.
If after scouting, you realise that there is more than 1 archer you cant trade their arrows and disarm for, just don't risk it. Shields can block one section of the body at the time, and they only need to get one lucky shot to cripple you.
Holding a shield at the center slows you down, so you cant run away. Shields are also heavy and impose penalties especially with 2 handed weapons.
tl;dr: Shields arent as good as they seem
Shields work great against animals though, especially bears. They can parry and block paws, hugs, and bites for some reason.
7. Overconfidence/Boredom can and will kill you
This is just general, sound advice for before, during, and after the fight. Even if you are clad in masterwork metal armors, have full skills, and have an army, you are not invincible. A lucky shot is all it takes to end all your hard work. Foreign traders are relatively common in some regions, so I recommend taking time to fully recover from injuries before engaging them if you have already dispatched another band of them recently.
Though it can be argued that foreign traders are one of the strongest human foes you can face in the game, their behavior is simply rushing at you, allowing you to cheese them by running away until they are tired and then fire arrows at them. This behavior is not shared among all foes, especially wolves who, because of the speed of wolves combined with the fleeing mechanic, will hit and run you until you die or they give up.
That is all I have to share, hopefully this run goes better and i get past my third FT band kill.
Update: 4 groups wiped, at least 20 kills on my back. This works
Update 2: I drowned. Game bugged out and let me ski onto unsafe ice in the wilderness map, forcing me to zoom in. I died trying to get to shore.