Derivative Instruments: Types of Derivative Instruments

In this article, we will discuss the Introduction to Derivative Instruments and Types of Derivative Instruments. Again, the list covered in this article may not be comprehensive, but should be sufficient for someone interested in learning about the Derivative Instruments and the types of Derivative Instruments. This article will give a complete overall picture of the various courses and contents of Derivative Instruments. We are covering Plain Vanilla Derivatives like Futures, Options as well as exotics like Swaps and Swaptions. Here is the link to Options Trading Tutorials

Introduction to Derivative Instruments:

Derivative terminology and definitions : The first level overview of Derivatives

General characteristics of derivatives: The features, pricing elements and what determines, define and differentiates a derivative intstrument from other financial instruments.

Derivatives compared to securities : This topic is conttinuation of the above topic

Risk management applications : USe of Derivatives for Risk Management


Futures and Forward Contracts :

Terminology and definitions : of Futures and Forward Contracts

Exchange traded (listed) versus over-the-counter (OTC) contracts : The various type in terms of trading Futures and Forward Contracts

Types of contracts (equity, currency, energy, etc.) : Based upon the udnerlying how the Futures and Forward Contracts are classified

Forward pricing basics : Introdcution to Futures and Forward Contracts Pricing Models

Trading and risk management applications : How to use Futures and Forward Contracts for Risk management

Options :

Terminology and definitions : of Options

Option contract characteristics : Features of Options Instruments

Buying calls and puts : Difference between Put and Call Options

Writing (selling) calls and puts : Short Selling of Put and Call Options

Combination trading strategies : Various financial structures to be created using Options

Option pricing basics : The Black Scholes Model for pricing the Options


Swaps :

Terminology and definitions of Swaps

Swap contract characteristics

Interest rate swap contract cash flows and risks

Other types of swaps- equity, currency, commodity and credit/default

Risk management applications and use of Swaps for Risk Management