2006-08-06 20:06:31 · 2 answers · asked by jim 1 in Business & Finance ➔ Investing
There shouldn't be a difference between India and the rest of the world. A Derivative is a security that derives it's value from an underlying asset. Derivatives consist of Futures, Options, Forward Contracts, Swaps and Floating Rate Debt.
As an example, the value of the futures contract derives it's value from the price of the instrument it is based on. A corn futures contract derives it's value from the value of the physical corn itself. If you look at the price of Cash Corn and a Corn futures contract, you can see that they tend to move in tandem, but can move with some level of randomness. But, the price of the corn futures contract is linked to the value of the corn itself.
Hope that makes sense.
2006-08-07 00:39:10 · answer #1 · answered by 4XTrader 5 · 0⤊ 0⤋
Ask your share broker and he will advice you properly
2006-08-07 03:10:36 · answer #2 · answered by king 4 · 0⤊ 0⤋