Use LEFT and RIGHT arrow keys to navigate between flashcards;
Use UP and DOWN arrow keys to flip the card;
H to show hint;
A reads text to speech;
11 Cards in this Set
- Front
- Back
|
Is a financial security with a value that is reliant upon- underlying asset or group of assets. Between to or more parties |
Derevative |
|
|
Are so effective in reducing risk because they enable or eliminates risk when a financial institution has bought an asset |
Financial derivatives |
|
|
Is a technique or strategy that comes as a from of investment designed to avoid market |
Hedging |
|
|
Two types of hedging |
Classical hedging and natural hedging |
|
|
Involves stocks and shares |
Classical hedging |
|
|
Doesnt involve stock and shares |
Natural hedging |
|
|
Meanwhile are a financial instrument used in hedging |
Derivatives |
|
|
Can take the form of options futures forward caps floor swaps collars and many others |
Derivatives |
|
|
Two main Types of derivative |
Forward and options |
|
|
Are agreement between two parties to buy or sell assets |
Forward |
|
|
Contract give the owners the right but not the duty to buy or sell |
Option |
