Skip to main content
Derivatives

Derivative Security

Securities that derive their value from another security are known as underlying securities. This means that their worth is influenced by the features and value of the underlying security. For instance, options contracts are considered underlying securities as their value is dependent on the performance of the underlying asset. Understanding the concept of underlying securities is crucial in the world of finance, as it allows investors to make informed decisions and manage risks effectively.

Related terms

Contract Month

Understand the meaning and definition of Contract Month in the context of stock market, trading, and investments.

MORE
Deep Discount Bonds

Understand the meaning and definition of Deep Discount Bonds in the context of stock market, trading, and investments.

MORE
Basis

Understand the meaning and definition of Basis in the context of stock market, trading, and investments.

MORE
Out-of-the-money

Understand the meaning and definition of Out-of-the-money in the context of stock market, trading, and investments.

MORE
Equity Options

Understand the meaning and definition of Equity Options in the context of stock market, trading, and investments.

MORE
In-the-money

Understand the meaning and definition of In-the-money in the context of stock market, trading, and investments.

MORE

Open Free Demat Account!

Join our 3.5 Cr+ happy customers

+91
Explore other categories
Enjoy Zero Brokerage on Equity Delivery
4.4 Cr+DOWNLOADS

Enjoy Zero Brokerage On Stock Investments

Get the link to download the App

Scan this QR code to download the app
Get it on Google PlayDownload on the App Store

Open Free Demat Account!

Join our 3.5 Cr+ happy customers
+91