Derivative: Difference between revisions

From ACT Wiki
Jump to navigationJump to search
imported>Doug Williamson
(Remove surplus link.)
imported>Doug Williamson
(Add links.)
 
(8 intermediate revisions by the same user not shown)
Line 1: Line 1:
# Abbreviation for derivative financial instrument.
1. ''Financial instruments.''
# ''Maths''.  A derivative function describes the rate of change of the underlying function, with respect to changes in one of the variables in the underlying function.


::: The first derivative describes the slope of the function curve at a given point on the curve.
Abbreviation for derivative financial instrument.
 
 
2. ''Maths''. 
 
A derivative function describes the rate of change of the underlying function, with respect to changes in one of the variables in the underlying function.
 
*The first derivative describes the slope of the function curve at a given point on the curve.
*The second derivative describes the rate of change of the slope.  In other words the degree of curvature, at a given point.
 
 
Most of the 'Greek letters' in options analysis are the first derivative of the option value, as the related value driver changes.


::: The second derivative describes the rate of change of the slope.  In other words the degree of curvature, at a given point.


== See also ==
== See also ==
* [[Credit derivative]]
* [[Crypto-derivative]]
* [[Delta]]
* [[Derivative instrument]]
* [[Derivative instrument]]
* [[Differentiation]]
* [[Embedded derivative]]
* [[Embedded derivative]]
* [[Financial instrument]]
* [[Fixing derivative]]
* [[Greeks]]
* [[Greeks]]
* [[Interest rate derivative]]
[[Category:Manage_risks]]
[[Category:Financial_products_and_markets]]

Latest revision as of 09:21, 31 August 2022

1. Financial instruments.

Abbreviation for derivative financial instrument.


2. Maths.

A derivative function describes the rate of change of the underlying function, with respect to changes in one of the variables in the underlying function.

  • The first derivative describes the slope of the function curve at a given point on the curve.
  • The second derivative describes the rate of change of the slope. In other words the degree of curvature, at a given point.


Most of the 'Greek letters' in options analysis are the first derivative of the option value, as the related value driver changes.


See also