Financial derivative refers to a bilateral contract for payment according to pre-agreed matters, and its contract price depends on or comes from the price of the original financial instrument and its changes. Financial derivatives are relative to original financial instruments. These related or major financial instruments generally refer to stocks, bonds, certificates of deposit, currencies, etc.

First, the concept and characteristics of financial derivatives

(A) the concept of financial derivatives

Financial derivatives refer to derivative financial products whose prices are determined by the changes of basic products or basic variables.

(B) the basic characteristics of financial derivatives

1. Intertemporal transaction

2. Leverage effect

3. Uncertainty and high risk

4. Hedging and speculative arbitrage

Second, the classification of financial derivatives

(a) according to the type of basic tools:

1. Stock derivatives

2. Currency derivatives

3. Interest rate derivatives

(2) According to the characteristics of risk and return:

Symmetric type and asymmetric type

(3) According to the transaction mode and characteristics:

Financial forward contracts, financial futures, financial options and financial swaps.

Financial derivatives include: forward contracts, financial futures, options and swaps.

1. Futures contract. Futures contract refers to the standardized contract made by the futures exchange to deliver a certain quantity and quality of physical or financial goods at a specific time and place in the future.

2. option contracts. Option contract refers to the option contract that the buyer of the contract can get after paying a certain amount. At present, warrants in China's securities market belong to call options, while put warrants belong to put options.

3. Forward contracts. Forward contract refers to a contract in which both parties agree that the buyer will buy a certain amount of subject matter from the seller at an agreed value on a certain date in the future.

4. Swap contracts. A swap contract refers to a contract in which both parties exchange a series of cash flows in a certain period in the future. According to different contract items, swaps can be divided into interest rate swaps, currency swaps, commodity swaps and equity swaps. Among them, interest rate swap and currency swap are more common.