Futures and Options are the most common form of Derivatives. A Future is a contract to buy or sell the underlying asset for a specific price and at a pre-determined time. An Option is contract between two parties concerning buying or selling of the underlying asset at a reference price.
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Derivatives are those financial instruments that derive their value from an underlying asset. The underlying is typically a tradable asset such as stocks or it could be an index, a currency, a commodity or even an event.
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