O'Reilly logo

An Introduction to Trading in the Financial Markets: Market Basics by R. Tee Williams

Stay ahead with the world's most comprehensive technology and business learning platform.

With Safari, you learn the way you learn best. Get unlimited access to videos, live online training, learning paths, books, tutorials, and more.

Start Free Trial

No credit card required

Introduction

Instruments are the products traded in the markets we are exploring. We define three major categories of instruments: cash, derivative, and packaged instruments. Several characteristics of instruments differ among categories. For example, cash instruments convey ownership of something. Securities, a subcategory of cash instruments, convey to the purchaser ownership of a financial asset. Currencies represent ownership of actual cash, and commodities trading results in ownership of physical goods.

Derivative instruments are generally standardized contracts. The contract usually obligates one party to the contract to undertake specific actions under certain circumstances defined in the contract. Figure 2 provides an overview of traded ...

With Safari, you learn the way you learn best. Get unlimited access to videos, live online training, learning paths, books, interactive tutorials, and more.

Start Free Trial

No credit card required