0
A derivative can be defined as something which derives its value from an underlying product being a stock, currency, commodity or anything that carries a market price.
The market price of a product is subject to fluctuations due to various factors effecting its demand & supply thereby associating itself to various risk factors.
SO, derivative is a by-product of the core product which can be used to hedge, speculate & also undertake arbitrage activities.
Wiki User
∙ 13y ago
Add your answer:
Earn +20 pts
What do equity derivatives refer to?
Equity derivatives refer to the options and futures one has when trading or selling off different equitable assets. Equity options are the most common derivatives that there are.
What is derivatives in terms of finance..?
In finance, a derivative is a financial instrument (or, more simply, an agreement between two parties) that has a value, based on the expected future price movements of the asset to which it is linked-called the underlying asset-such as a share or a currency. There are many kinds of derivatives, with the most common being swaps, futures, and options. Derivatives are a form of alternative investment. A derivative is not a stand-alone asset, since it has no value of its own. However, more common types of derivatives have been traded on markets before their expiration date as if they were assets. Among the oldest of these are rice futures, which have been traded on the Dojima Rice Exchange since the eighteenth century. Derivatives are usually broadly categorized by: * the relationship between the underlying asset and the derivative (e.g., forward, option, swap); * the type of underlying asset (e.g., equity derivatives, foreign exchange derivatives, interest rate derivatives, commodity derivatives or credit derivatives); * the market in which they trade (e.g., exchange-traded or over-the-counter); * their pay-off profile. Another arbitrary distinction is between: * vanilla derivatives (simple and more common); and * exotic derivatives (more complicated and specialized).
About derivatives market you mean the exacltly definition of derivative market?
the derivative market means the the price of particular product in the market is fluctuating time by time.
Why is derivatives important?
the simply meaning of derivative is a market which is helps to minimized the risk of loss. and the main objective if any business is to bring maximized profit to company so that's the reason to derivatives is important.
Identify the major types of securities traded in the securities markets?
shares ,derivatives
What is derivatives in banking?
what is derivatives in banking
What does dietary supplement mean?
Dietary Supplements are a designation of supplements that are derivatives of natural food products.
What is the formula for derivatives?
this site has info/formulas about derivatives and limits: http://www.scribd.com/doc/14243701/Calculus-Derivatives-Formula
What are derivatives for the latin word aquae?
Some derivatives are aqueous, aquaduct, aquifer.
What are derivatives and their uses?
derivatives are the functions required to find the turning point of curve
When was Swiss Derivatives Review created?
Swiss Derivatives Review was created in 1997.
Can derivatives be viewed as investment intruments?
Yes. Derivatives are instruments of investment for the knowledgeable financial people. Novice and intermediate investors should keep away from derivatives.
What do you learn in calculus?
In Calculus, you learn Limits, Derivatives, Anti-Derivatives and all their applications!
What is spatial derivatives?
They are derivatives with respect to measures in space: normally length, area or volume.
What are some derivatives for intrat?
Some derivatives for "intrat" could include "intra-" and "intr."
What are epidermal derivatives?
Keratin forms the basis of nails, feathers, beaks, and other epidermal derivatives.
What part of speech is the word derivatives?
The word derivatives is a noun. It is the plural form of the noun derivative.
