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underlying
(redirected from Underlying instruments)

   Also found in: Financial, Wikipedia 0.06 sec.
underlying adjective based on, basic, built on, deep-rooted, elemental, elementary, essential, latent, not evident, obscure, original, primal, primary, rudimentary, supporting, undermost, unseen
Associated concepts: underlying contract, underlying fact, underlying obligation
See also: basic, cardinal, central, essential, fundamental, initial, latent, organic, original, primary, rudimentary, substantive, virtual


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For newcomers to the field, a derivatives instrument is a bilateral contract or payments-exchange agreement whose value is measured by the value of one or more underlying instruments, reference points or markets.
This classification recognizes their junior subordinated ranking, the maturity of the underlying instruments in excess of 20 years, and the deferral feature of more than five years.
It contains accurate historical prices - dating back to January 1996 - of options and their associated underlying instruments, correctly calculated implied volatilities, and option sensitivities.
 
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