Derivative instrument and Investment trust: Difference between pages

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imported>Doug Williamson
(Example header added)
 
imported>Doug Williamson
(Typo 'a closed-ended'.)
 
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A derivative instrument or contract is one whose value and other characteristics are derived from those of another asset or instrument (sometimes known as the Underlying Asset).
An investment trust is a limited liability company whose sole aim is to invest in securities issued by other entities.




'''Example'''
Investment trusts are similar to unit trusts.


A share option is a type of derivative contract, allowing the holder to buy shares at a certain predetermined strike price.
However, unlike a unit trust, the number of shares that can be issued is limited (it is a closed-ended structure).
 
The value of the share option derives from the current price of the related underlying share relative to the option strike price.




== See also ==
== See also ==
* [[CertFMM]]
* [[Bid-offer spread]]
* [[Commodity risk]]
* [[Company]]
* [[Embedded derivative]]
* [[Investment company]]
* [[ETD]]
* [[Limited liability]]
* [[Fixing instrument]]
* [[Open-ended investment company]]
* [[Maturity]]
* [[Real estate investment trust]] (REIT)
* [[Notional principal]]
* [[Security]]
* [[Option]]
* [[Undertaking for collective investments in transferable securities]]
* [[Outright]]
* [[Unit trust]]
* [[Strike price]]
* [[Tracker fund]]
* [[Underlying]]
* [[Underlying asset]]
* [[Underlying price]]
 
 
===Other links===
*[http://www.treasurers.org/node/8599  Masterclass: Derivatives, The Treasurer, December 2012]  
 
*[http://www.treasurers.org/node/7849 Use and Misuse of Derivatives, Will Spinney, ACT 2012]


[[Category:Accounting,_tax_and_regulation]]
[[Category:The_business_context]]
[[Category:Corporate_finance]]
[[Category:Investment]]
[[Category:Long_term_funding]]
[[Category:Identify_and_assess_risks]]
[[Category:Manage_risks]]
[[Category:Risk_frameworks]]
[[Category:Risk_frameworks]]
[[Category:Risk_reporting]]
[[Category:Financial_products_and_markets]]

Revision as of 13:15, 16 December 2021

An investment trust is a limited liability company whose sole aim is to invest in securities issued by other entities.


Investment trusts are similar to unit trusts.

However, unlike a unit trust, the number of shares that can be issued is limited (it is a closed-ended structure).


See also