Think Different

                                                                                 generated by metaai 1. What are Derivatives? Derivatives are financial contracts whose value is derived from an underlying asset, such as stocks, commodities, currencies, or indices. The two most common types of derivatives are options and futures. 2. Options An option is a contract that gives the buyer the right, but not the obligation, to buy or sell an underlying asset at a predetermined price (called the strike price) on or before a specific date (called the expiration date). Key Terms in Options: - Call Option: Gives the buyer the right to buy the underlying asset. - Put Option: Gives the buyer the right to sell the underlying asset. - Strike Price: The price at whic...