Underlying Asset financial definition of Underlying Asset. Underlying Asset finance term by the Free Online Dictionary.

Underlying asset

The security or property or loan agreement that an option gives the option holder the right to buy or to sell.

Underlying Asset

In a derivative or warrant, the security, property, or other asset that gives value to the derivative or warrant. For example, in an option giving one the right to buy stock in Johnson and Johnson, the underlying asset is the stock in Johnson and Johnson. An underlying asset may many things, such as a physical commodity, a security, a piece of land, or part of a business.

underlying asset

1. The physical and financial asset to which a security holder or a class of security holders has a claim. An analyst may believe that a stock is underpriced on the basis of the value of the firm's underlying assets and the potential earning power of those assets.

2. The asset that underlies and gives value to a security. The underlying asset of a stock option is the stock that the option can be used to purchase. Likewise, the underlying asset of a convertible bond is the stock for which the bond can be exchanged. The market value of a security is directly affected by changes in the value of any underlying asset into which it may be exchanged.

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Balloon Option Capping Covered Writer Dealer Option In-the-Money Option Married Put and Stock Naked Put Path-Dependent Option Uncovered Put Writing			Evaluating actual underlying assets in equity and bond investments. Collateral thinking: how can you ensure that a major debtor won't ... by Anderson, Mark / Financial Management (UK) At this date, the option buyer is to decide if a transaction of the underlying asset is to occur. What Is Options Trading? by Andy Poon / Finance and Investment community Spread bets allow you to bet that the price of an underlying asset (a share, commodity or index) will rise or fall. Gearing up - Spread Betting by Andy Richardson / Travel, recreation and leisure community			Underbanked Underbooked Undercapitalized Undercharge Underclass Undercolor Removal Underconsumption underdepreciation Underemployed Underemployment Underfunded Underfunded Pension Plan Underground Storage Insurance underground storage tank Underhand underimprovement Underinsurance Underinsured Underinsured Motorist Coverage Limits Trigger Underinsured Motorist Coverage Modified Limits Trigger Underinsured Motorist Endorsement Underinvestment Problem Underinvoicing Underleveraged Underlying Underlying Asset Underlying Debt Underlying Futures Contract Underlying Index Underlying Inflation Underlying Instrument Underlying Investment underlying mortgage Underlying Price Underlying Retention Underlying Security Underlying Service Underlying Value Undermargined Undermargined Account Underpayment Underpayment Penalty Underperform Underperforming Asset Underpricing undersecured loan Undersell Underspend Understandability Undersubscribed Undertakings for Collective Investment in Transferable Securities			underline underline underlined underlined underlined underlined underlinen underlines underlines underlines underling underlings underlining underlining underlining underlining felt underlining felt Underlinking underlip underlips Underload Underload starter Underload switch Underload Syndrome underlock underlooker underlying underlying underlying underlying Underlying Asset Underlying Assets underlying assumption Underlying assumptions Underlying assumptions Underlying assumptions Underlying assumptions Underlying Carrier underlying cause of death underlying cause of death Underlying Commodities Underlying Commodity Underlying Companies Underlying Company Underlying debt Underlying Debts Underlying Event Underlying Foreign Tax Credit Underlying futures contract Underlying Futures Contracts underlying graph Underlying Hazardous Constituents Underlying Index Underlying Inflation Underlying Inflation Rate Underlying Inflation Rates Underlying instrument Underlying instrument Underlying instrument Underlying instruments Underlying instruments