derivative

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Derivative

A financial contract whose value is based on, or "derived" from, a traditional security (such as a stock or bond), an asset (such as a commodity), or a market index.

Derivative Security

Futures, forwards, options, and other securities except for regular stocks and bonds. The value of nearly all derivatives are based on an underlying asset, whether that is a stock, bond, currency, index, or something else entirely. Derivative securities may be traded on an exchange or over-the-counter. Derivatives are often traded as speculative investments or to reduce the risk of one's other positions. Prominent derivative exchanges include the Chicago Mercantile Exchange and Euronext LIFFE.

derivative

An asset that derives its value from another asset. For example, a call option on the stock of Coca-Cola is a derivative security that obtains value from the shares of Coca-Cola that can be purchased with the call option. Call options, put options, convertible bonds, futures contracts, and convertible preferred stock are examples of derivatives. A derivative can be either a risky or low-risk investment, depending upon the type of derivative and how it is used. See also underlying asset.

Derivative.

Derivatives are financial products, such as futures contracts, options, and mortgage-backed securities. Most of derivatives' value is based on the value of an underlying security, commodity, or other financial instrument.

For example, the changing value of a crude oil futures contract depends primarily on the upward or downward movement of oil prices.

An equity option's value is determined by the relationship between its strike price and the value of the underlying stock, the time until expiration, and the stock's volatility.

Certain investors, called hedgers, are interested in the underlying instrument. For example, a baking company might buy wheat futures to help estimate the cost of producing its bread in the months to come.

Other investors, called speculators, are concerned with the profit to be made by buying and selling the contract at the most opportune time. Listed derivatives are traded on organized exchanges or markets. Other derivatives are traded over-the-counter (OTC) and in private transactions.

derivative

a financial instrument such as an OPTION or SWAP whose value is derived from some other financial asset (for example, a STOCK or SHARE) or indices (for example, a price index for a commodity such as cocoa). Derivatives are traded on the FORWARD MARKETS and are used by businesses and dealers to ‘hedge’ against future movements in share, commodity etc. prices and by speculators seeking to secure windfall profits. See LONDON INTERNATIONAL FINANCIAL FUTURES EXCHANGE (LIFFE), EUREX.

derivative

a financial instrument such as an OPTION or SWAP the value of which is derived from some other financial asset (for example, a STOCK or SHARE) or indices (for example, a price index for a commodity such as cocoa). Derivatives are traded on the FUTURES MARKETS and are used by businesses and dealers to ‘hedge’ against future movements in share, commodity, etc., prices and by speculators seeking to secure windfall profits. See LONDON INTERNATIONAL FINANCIAL FUTURES EXCHANGE (LIFFE), STOCK EXCHANGE.
References in periodicals archive ?
Furthermore, this method requires the identification of the differences between the successive outputs as the first derivative and infer therefore that the difference of the differences between the outputs is the second derivative.
First Derivative's September 2004 amended complaint added JCM as a defendant; the defendants prevailed on a motion to dismiss on a class definition issue; and First Derivative filed a second amended complaint.
3] Jain, MK, Aziz, T: Cubic spline solution of two-point boundary value with signifigant first derivatives.
Using the ClassPad to find the first derivative we obtain the result shown in Figure 6.
Table 1 also shows that using the first derivative of the spectra produces better accuracy for the PLS model.
Figures 5, 6, and 7 show that the plot of the first derivative in the xx direction resembles the one of in the yy direction.
The North American cars are wider than their counterparts, and the Rogue will be the first derivative to come off this variant of the Global C platform.
We establish weighted Ostrowski-Gruss type inequality for differentiable mappings in terms of the upper and lower bounds of first derivative.
515] or the first derivative of reflectance at 545 nm in the present study could avoid the influence of moisture on canopy reflectance.
The first derivative of many well known names, such as 'Tiger', have already been excluded, but of course would be made available to the world's number one golfer on request", he added.