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stelios

913 Posts.

150

14/01/20

06:37

Post #: 42361678
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Originally posted by Fudley61: ↑

A derivative is afinancial securitywith a value that is reliant upon or derived from, an underlying asset or group of assets—a benchmark. The derivative itself is a contract between two or more parties, and the derivative derives its price from fluctuations in the underlying asset.

Futures are derivative financial contracts that obligate the parties to transact an asset at a predetermined future date and price. Here, the buyer must purchase or the seller must sell the underlying asset at the set price, regardless of the current market price at the expiration date.

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"derivative derives its price from fluctuations in the underlying asset."

“The tail is wagging the dog” as the reverse applies.
The market is flooded with naked derivatives forcing down the underlying asset.
This way the true value of fiat currencies is concealed.

Last edited by stelios: 14/01/20
5 Upvote

0 Great analysis

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