Sublime

A ‘derivative’ is the rate of change of a slope on a graph. If you had a graph of time (seconds) and distance (metres), the shape of the line tells you something about the speed (metres per second). If the line is straight, your speed is constant. If the line is curved, your speed is changing. A derivative measures the slope of the curve at an exac

A derivative is a contract whose value is derived from another underlying asset such as stocks, commodities, currencies, indexes, bonds, or interest rates. Each type of derivative, whether futures, options or swaps serves a different purpose, and each investor buys or sells them for various reasons.

The derivative of a function is just its slope at each point. But when the function depends on two or more variables, we don’t simply have a curve with a unique slope at each point.

A derivative is a contract whose value is derived from another underlying asset such as stocks, commodities, currencies, indexes, bonds, or interest rates. Traders can use derivatives to hedge their positions and decrease their risk in any particular trade. For example, imagine you are a glove manufacturer and want to hedge yourself from an unexpec

A derivative is a contract based on an underlying financial asset – it is a contract on a contractual claim (confused?). A derivative is essentially a bet on some underlying financial asset going either up, or down in value – options contracts and futures contracts are examples of derivatives.

Derivatives are tools that transfer risk among willing participants. They allow an individual or institution with risk they don't like or cannot bear to transfer that risk to someone who's capable of bearing it in return for some payment.

Because of their contingent nature, the values of derivative securities can vary dramatically with the price of the stock. Extreme sensitivity is always dangerous, especially so when attempts to calculate the sensitivity depend on an inaccurate model.

Just like derivatives can be thought of as a way of making sense of zero divided by zero, an integral can be thought of as a way of making sense of infinity times zero,