Professional Documents
Culture Documents
1 Categorization
o 1.1 A table
2 Measuring financial instruments' gain or loss
3 See also
4 References
5 External links
Categorization
Financial instruments can be categorized by form depending on whether they are cash
instruments or derivative instruments:
Cash instruments are financial instruments whose value is determined directly by the
markets. They can be divided into securities, which are readily transferable, and other
cash instruments such as loans and deposits, where both borrower and lender have to
agree on a transfer.
Derivative instruments are financial instruments which derive their value from the value
and characteristics of one or more underlying entities such as an asset, index, or interest
rate. They can be divided into exchange-traded derivatives and over-the-counter (OTC)
derivatives.
Asset class
Instrument type
Securities
Other cash
Exchange-traded
OTC derivatives
derivatives
Loans
Bond futures
Options on bond
futures
Deposits
Certificates of
deposit
Forward rate
agreements
Stock
N/A
Stock options
Equity futures
Stock options
Exotic derivatives
Currency futures
Foreign exchange
options
Outright forwards
Foreign exchange
swaps
Currency swaps
Debt (long
term)
> 1 year
Bonds
Debt (short
term)
1 year
Equity
Foreign
exchange
N/A
Spot foreign
exchange
Some instruments defy categorization into the above matrix, for example repurchase agreements.
Measuring financial instruments' gain or loss
The table below shows how to measure a financial instrument's gain or loss:
Instrument
Type
Categories
Measurement
Assets
Loans and
receivables
Amortized costs
Assets
Available for
sale financial
assets
(deposity account)"#efbsit#