What is Financial Derivatives?
Financial derivatives are financial instruments that are linked to specific
assets. By nature, these instruments are similar to contingent instruments Claims
and liabilities related to financial instrument will arise after a specific period of time. Derivative instruments are not considered a financial claim or liability for the holder thereof at the given moment.
But financial derivatives can be traded in the market and they will obtain a market value, which will depend upon the market price of the underlying financial or non-financial asset.
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