Derivative Financial Instruments. Derivative products are financial instruments whose price depends on the underlying securities. The underlying security may be a commodity, financial instrument, financial index or credit risk. Derivatives are created to enable management of the asset on which they are based. Usual derivative products are divided into four primary categories: - swaps, - options, - futures, and - forwards The main risks to which derivatives are exposed is increased market risk, leverage risk and legal risk.
Appears in 2 contracts
Sources: Investment Services Agreement, Investment Services Agreement