Derivatives Markets

A derivative is a type of investment that depends on the value of something else, like a stock or an index. It's not worth anything on its own but instead gets its value from the thing it's linked to. Continue Reading Below

Content Types

Related Topics

Encyclopedia Articles

Discover the definition of financial terms related to derivatives markets.

Fugit: Definition, Applications, and Calculation Methods

Abi Bus

Underlying Securities: Definition, Role, and Applications

Alessandra Nicole

Look-Alike Contracts: Definition, Regulation, and Market Implications

Alessandra Nicole

Options Trading: Understanding Legging Out, Strategies, and Risks

Abi Bus

Options Trading: Deep Out of the Money Explained

Alessandra Nicole

Options Beyond Equities: Understanding Non-Equity Options and Their Applications

Abi Bus

Overnight Index Swaps: Understanding the Mechanism, Calculation, and Pros & Cons

Abi Bus

Risk-Neutral Probabilities: Definition, Applications, and Real-world Examples

Silas Bamigbola

Knock-In Options: Understanding, Types, and Real-Life Scenarios

Silas Bamigbola

Legs in Trading: Strategies, Types, and Real-world Examples

Silas Bamigbola

Page 27 of 28

Previous 24 25 26 27 28 Next

About Derivatives Markets

A derivative is a type of investment that depends on the value of something else, like a stock or an index. It's not worth anything on its own but instead gets its value from the thing it's linked to. Derivatives include futures and options contracts, which are agreements to buy or sell a stock, commodity, or other asset at a certain price in the future. These types of investments are traded in the derivatives market.

Futures markets are places where people trade futures contracts. Futures contracts are standardized and regulated, and trades are settled and confirmed through a clearinghouse. Options markets are similar and trade options contracts, which give the buyer the right, but not the obligation, to buy or sell an asset at a certain price. Futures and options markets trade contracts for different types of assets, like stocks, bonds, commodities, and so on.