Derivatives (Ro: instrumente financiare derivate, Fr: produit dérivé, n.m., contract dérivé, n.m., Gr.:χρηματιστηριακά παράγωγα, Cz.: deriváty) (See also: futures, options, forwards, swaps, asset-backed securities, mortgaged-backed securities, hedging) = financial instruments of contractual nature deriving their value from underlying assets. Though at their origins derivatives rationale is the protection against the price variation of their underlying assets, nowadays they represent securities that are mostly used for speculation. 

The contractual nature of derivatives provides unlimited possibilities of underlying assets, but the most common are stocks, bonds, commodities, currencies, interest rates and market indexes.

Useful links

Legislation - Regulation (EU) 648/2012 of the European Parliament and of the Council of 4 July 2012 on Over-The-Counter derivatives, central counterparties and trade repositories [English] - Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending [English] - Law 297/2004 on Romanian Capital Markets [Romanian] - Financial Services and Markets Act 2000, United Kingdom [English]

Online publications

Agarwal, R., Kumar, S., Mukhtar, W., Abar, H., 2009, Impact of Derivatives on Stock Market, Indian Finance Summit, January 2009. Available at SSRN: 

Hogan, A., Malmquist, D., 1998, Derivatives and Depository Interest Rate Risk: An Empirical Analysis, Available at SSRN: 

Liu, S., 2010, Currency Derivatives and Exchange Rate Forecastability, Financial Analysts Journal, Vol. 63, No. 4, pp. 72-78, July/August 2007, Available at SSRN:


Kolb, R., Overdahl, J., 2009, Financial Derivatives: Pricing and Risk Management, Wiley

Loader, D., 2005, Clearing and Settlement of Derivatives, Elsevier Finance

Rheinlander, T.,  Sexton, J., 2011, Hedging Derivatives, World Scientific

Strong, R., 2005, Derivatives: An Introduction, Thomson/South-Western

Succo, J., 2011, A Derivatives Primer: Options, Futures and Structures, Financial Times Press

Whale, R.,  2007, Derivatives: Markets, Valuation, and Risk Management, Wiley Finance


By Alexandru Coraș