Which of the following financial instruments is not considered a derivative financial instrument? (2024)

Which of the following financial instruments is not considered a derivative financial instrument?

Correct answer:

Which of the following financial instruments is not a derivative?

Bank Certificates of Deposit is not an Derivative financial instrument .

Which of the following is not a derivatives instrument?

Debentures are the marketable securities that businesses can issue to obtain long term financing. These are kind of bonds. Hence it can be concluded that Debentures are not the instrument of derivative market.

What are non derivative financial instruments?

A non-derivative asset is one whose value does not depend on the value of another asset such as a currency: Non-derivative financial instruments consist of trade and other receivables, cash and cash equivalents, and long-term debt.

What are the derivative financial instruments?

Financial derivatives are financial instruments that are linked to a specific financial instrument or indicator or commodity, and through which specific financial risks can be traded in financial markets in their own right.

What are derivative and non derivative financial instruments?

The main difference between financial derivatives and non-derivative securities is that derivatives are financial instruments whose value is derived from the underlying assets, while non-derivative securities are assets that have a value independent of any other security or asset.

Which of the following is not a financial instrument?

The following are examples of items that are not financial instruments: intangible assets, inventories, right-of-use assets, prepaid expenses, deferred revenue, warranty obligations (IAS 32. AG10-AG11), and gold (IFRS 9. B. 1).

What are the 4 types of derivatives?

Which of the following is not an example of derivatives?

Final answer:

Cash is not a derivative because it does not derive its value from another asset, unlike interest rate swaps, stock options, and forward contracts.

What does not have a derivative?

Hence at x=0 , f(x)=|x| f ( x ) = | x | does not have a derivative. If a function is not defined at a point, then it is not differentiable. For examplef(x)=1x f ( x ) = 1 x is not differentiable at x=0 since f(0) is not defined.

What are non derivative securities?

Non-Derivative Securities: Securities whose value is not derived from another security. A tradable financial asset. Example: common stock.

Is swap a derivative financial instruments?

A swap is a derivative contract through which two parties exchange the cash flows or liabilities from two different financial instruments. Most swaps involve cash flows based on a notional principal amount such as a loan or bond, although the instrument can be almost anything.

What is an example of a derivative instrument?

Derivatives are financial instruments that derive their value from an underlying asset, index, or reference rate. Examples of derivatives include futures contracts, options contracts, swaps, and forward contracts.

Are ETFs a derivative?

ETFs are not derivatives; they are investment funds with diversified portfolios of stocks, bonds, and other assets. Some leveraged and inverse ETFs are derivative-based.

What is a derivative instrument in accounting?

Derivatives – financial instruments that derive their value from the price of one or more other assets such as equity, debt, foreign currencies, or commodities.

Is a loan a derivative instrument?

A debt security or loan requires an initial net investment of the principal amount or (if purchased at a discount or premium) an amount calculated to yield a market rate of interest. No. The contract does not meet the definition of a derivative.

What are the 10 financial instruments?

Common examples of financial instruments include stocks, exchange-traded funds (ETFs), mutual funds, real estate investment trusts (REITs), bonds, derivatives contracts (such as options, futures, and swaps), checks, certificates of deposit (CDs), bank deposits, and loans.

What are the 8 financial instruments?

What is an example of a non financial instrument?

A nonfinancial asset is an asset that derives its value from its physical traits. Examples include real estate and vehicles. It also includes all intellectual property, such as patents and trademarks.

What are the 5 examples of derivatives?

Five of the more popular derivatives are options, single stock futures, warrants, a contract for difference, and index return swaps. Options let investors hedge risk or speculate by taking on more risk. A stock warrant means the holder has the right to buy the stock at a certain price at an agreed-upon date.

What are the three types of derivatives?

There are many types of derivative contracts including options, swaps, and futures or forward contracts.

What are the two most common derivatives?

Common underlying assets include investment securities, commodities, currencies, interest rates and other market indices. There are two broad categories of derivatives: option-based contracts and forward-based contracts.

What is not a derivative quizlet?

A futures contract is a derivative, since its price movements are based on the movement of an underlying physical asset. An investment contract is not a derivative. A customer would buy call contracts because: the customer is bullish on the underlying security. the customer is bearish on the underlying security.

Which of the following are financial derivatives?

In finance, there are four basic types of derivatives: forward contracts, futures, swaps, and options.

What are considered derivatives?

Definition: A derivative is a contract between two parties which derives its value/price from an underlying asset. The most common types of derivatives are futures, options, forwards and swaps. Description: It is a financial instrument which derives its value/price from the underlying assets.