Derivative/Definition: Difference between revisions
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imported>Nick Gardner (New page: a financial asset whose agreed value depends upon the expected value of another asset. A typical example is a futures contract which is an undertaking to buy a stipulated asset at a stipul...) |
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In finance, an asset whose agreed value depends upon the expected value of another asset. A typical example is a futures contract which is an undertaking to buy a stipulated asset at a stipulated price at a stipulated future time. Other examples are options (qv) and futures contracts. Some derivatives can be used to protect (hedge) an investor against risk. | |||
Revision as of 16:55, 21 February 2008
In finance, an asset whose agreed value depends upon the expected value of another asset. A typical example is a futures contract which is an undertaking to buy a stipulated asset at a stipulated price at a stipulated future time. Other examples are options (qv) and futures contracts. Some derivatives can be used to protect (hedge) an investor against risk.