Derivative instruments
In this lesson, you'll learn what derivative instruments are and why companies use them to manage financial risk. You'll explore the strategic advantages of derivatives—including risk management, speculation, portfolio diversification, and customised hedging—and discover the main types of instruments split between
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In this lesson
- 0:00 Lesson 22 Hedging Basics overview
- 0:29 What are derivative instruments
- 0:51 Underlying assets and derivative types
- 1:27 Strategic advantages of derivatives
- 2:01 Risk management through hedging
- 2:34 Speculation and portfolio gains
- 3:52 Customising derivatives to risk appetite
About this lesson
over-the-counter and traded derivatives. You'll also understand key terminology like margins and basis risk, giving you the foundation to apply these concepts to currency and interest rate risk scenarios in your FM or AFM studies.
Duration: 4m
Transcript
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