Derivatives: what these financial instruments are and how they work
Derivative financial instruments represent a complex and advanced category of investments whose value is based on an underlying asset, also […]
Derivative financial instruments represent a complex and advanced category of investments whose value is based on an underlying asset, also […]
The term underlying refers to the variable or asset on which the price of a derivative instrument depends. In essence,
A put option is a futures contract that gives the buyer the right, but not the obligation, to sell an
A call option is a futures contract that gives the buyer the right to buy an underlying asset, such as
Options are derivative instruments that give the buyer the right, but not the obligation, to buy or sell an underlying
An European option is a type of financial contract that allows the holder to exercise its right only on a
The American option represents a type of financial contract that offers the holder the opportunity to exercise his or her
A credit default option (CDO) is a financial risk management instrument designed to provide a hedge against deterioration in the