types of derivatives
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Answer / rajesh
Deri. are of 4 types
1. forward
2. future
3. optoins
4. swaps
| Is This Answer Correct ? | 136 Yes | 8 No |
Answer / manju.s
Types of Derivatives.
1.Forwards.
2.Futures.
3.Options.(call & put options)
4.Swaps.(Interest rate & currency swap)
5.Warrants.
6.Leaps.
7.Baskets.
8.Swaptions.
| Is This Answer Correct ? | 60 Yes | 9 No |
Answer / neha
There are 2 types of derivatives 1.Financial derivatives &
2. Commodity Derivatives
Commodity derivatives the underlying instruments is a
commodity which may be sugar, cotton, copper, gold, silver.
& Financial Derivatives the underlying instruments is
stock, bond, foreign exchange.
Financial Derivatives further divided into 2 types 1.basic
2.Complex.
1.Basics 4 parts 1. Forward 2. Future 3.Option 4. Warrents
& Convertibles 2.Complex 1.swap 2.exotics
| Is This Answer Correct ? | 48 Yes | 12 No |
Answer / ruchi
Derivatives are the instrument whose valus depend on the
value of some undelying assest. we can say that it is a
side bet on that assest
Deri. are of 2 types
1-Futures
2-Options
Exp- a farmer anticipate he produce 2ton of wheat he has
requirement of momney. So he can enter in future or Option
contract and sell his future prodution at market rate and
recevied the money.
| Is This Answer Correct ? | 50 Yes | 30 No |
Answer / rajan sevak
Forwards: A forward contract is a customized contract
between two entities, where settlement takes place on a
specific date in the future at today's pre-agreed price.
Futures: A futures contract is an agreement between two
parties to buy or sell an asset at a certain time in the
future at a certain price. Futures contracts are special
types of forward contracts in the sense that the former are
standardized exchange-traded contracts.
Options: Options are of two types - calls and puts. Calls
give the buyer the right but not the obligation to buy a
given quantity of the underlying asset, at a given price on
or before a given future date. Puts give the buyer the
right, but not the obligation to sell a given quantity of
the underlying asset at a given price on or before a given date.
Swaps: Swaps are private agreements between two parties to
exchange cash flows in the future according to a prearranged
formula. They can be regarded as portfolios of forward
contracts. The two commonly used swaps are:
Interest rate swaps: These entail swapping only the
interest related cash flows between the parties in the same
currency.
Currency swaps: These entail swapping both principal and
interest between the parties, with the cash flows in one
direction being in a different currency than those in the
opposite direction.
Warrants: Options generally have lives of upto one year, the
majority of options traded on options exchanges having a
maximum maturity of nine months. Longer-dated options are
called warrants and are generally traded over-the-counter.
LEAPS: The acronym LEAPS means Long-Term Equity Anticipation
Securities. These are options having a maturity of upto
three years.
Baskets: Basket options are options on portfolios of
underlying assets. The underlying asset is usually a moving
average or a basket of assets. Equity index options are a
form of basket options.
Swaptions: Swaptions are options to buy or sell a swap that
will become operative at the expiry of the options. Thus a
swaption is an option on a forward swap. Rather than have
calls and puts, the swaptions market has receiver swaptions
and payer swaptions. A receiver swaption is an option to
receive fixed and pay floating. A payer swaption is an
option to pay fixed and receive floating.
| Is This Answer Correct ? | 15 Yes | 2 No |
Answer / dua
Types of Financial Derivatives:
In recent years, derivatives have become increasingly important in the field of finance. Forwards, futures, options swaps, warrants, and convertibles are the major types of financial derivatives. A complex variety of composite derivatives, such as swap options, have emerged by combining some of the major types of financial derivatives:
1. Forwards: A forward contract is a contract between two parties obligating each to exchange a particular good or instruments at a set price on a future date. It is an over the counter agreement and has standardized market features.
2. Futures: Futures are standardized contracts between the buyers and sellers, which fix the terms of the exchange that will take place between them at some fixed future date. A futures contract is a legally binding agreement. Futures are special types of forward contracts which are exchange traded, that is traded on an organized exchange. The major types of futures are stock index futures, interest rate futures, and currency futures.
3. Options: Options are contracts between the option writers ad buyers which obligate the former and entitles (without obligation) the latter to sell/buy stated assets as per the provisions of contracts. The major types of options are stock options, bond options, currency options, stock index options, futures options, and options on swaps. Options are of two types: calls and Puts. A call option gives a buyer/holder a right but not an obligation to buy the underlying on or before specified time at a specified price (usually called strike/exercise price) and quantity. A put option gives a holder of that option a right but not an obligation to sell the underlying on or before specified time at a specified price and quantity.
4. Swaps: Swaps are generally customized arrangements between counterparties to exchange one set of financial obligations for another as per the terms of agreement. The major types of swaps are currency swaps, and interest rate swaps, bond swaps, coupon swaps, debt equity swaps.
| Is This Answer Correct ? | 11 Yes | 3 No |
Answer / md.asmathullah
.Forwards.
2.Futures.
3.Options.(call & put options)
4.Swaps.(Interest rate & currency swap)
5.Warrants.
6.Leaps.
7.Baskets.
8.Swaptions.
| Is This Answer Correct ? | 9 Yes | 3 No |
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