Sentences with phrase «function of an underlying asset»
Because it is a function of an underlying asset, a futures contract is a derivative product.
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The economic analysis and asset pricing component provides an introduction to the function of markets generally as well as the economic and financial theory that underlies derivatives pricing and hedging.
Consider an over-the-counter (OTC) option sold (written) by Bank A to Customer C. Market risk refers to the fluctuating value of the option; if it is daily - mark - to - market, its value will be a function largely of the underlying asset price but also several other risk factors.