General Studies · Derivatives
Which of the following best describes a derivative instrument?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1A loan given by one party to another, secured by a pledge of assets
- 2A financial instrument whose value is derived from the value of one or more underlying variables (such as an asset, index or rate)✓
- 3A contract to purchase physical goods for immediate delivery only
- 4A financial instrument whose value is fixed at inception and does not change until maturity
Correct answer
A financial instrument whose value is derived from the value of one or more underlying variables (such as an asset, index or rate)
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