Convertible debt and Derivative instrument: Difference between pages
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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). | |||
Derivative instruments are widely used by non-financial corporates for hedging purposes. | |||
<span style="color:#4B0082">'''Example'''</span> | |||
A share option is a type of derivative contract, allowing the holder to buy shares at a certain predetermined strike price. | |||
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]] | ||
* [[ | * [[Commodity risk]] | ||
* [[ | * [[Embedded derivative]] | ||
* [[ | * [[ETD]] | ||
* [[Fixing instrument]] | |||
* [[Hedge fund]] | |||
* [[Hedging]] | |||
* [[Maturity]] | |||
* [[Notional principal]] | |||
* [[Option]] | |||
* [[Outright]] | |||
* [[Strike price]] | |||
* [[Tracker fund]] | |||
* [[Underlying]] | |||
* [[Underlying asset]] | |||
* [[Underlying price]] | |||
* [[XVA]] | |||
===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] | |||
[http://www.treasurers.org/node/ | |||
[[Category: | [[Category:Risk_frameworks]] | ||
Revision as of 14:29, 13 May 2016
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).
Derivative instruments are widely used by non-financial corporates for hedging purposes.
Example
A share option is a type of derivative contract, allowing the holder to buy shares at a certain predetermined strike price.
The value of the share option derives from the current price of the related underlying share relative to the option strike price.
See also
- CertFMM
- Commodity risk
- Embedded derivative
- ETD
- Fixing instrument
- Hedge fund
- Hedging
- Maturity
- Notional principal
- Option
- Outright
- Strike price
- Tracker fund
- Underlying
- Underlying asset
- Underlying price
- XVA
