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Structured financial products is the use of financial engineering technology, deposits, zero interest bonds and other fixed income products and financial derivatives (such as forward, options, swaps, etc.) together to form a new type of financial products. Which is a combination of financial derivatives that is linked to the subject
InBank financial productsThere is a class of structural typeFinancial productThe Structure typeFinancial managementProducts are the use of financial engineering technology, deposits, zero interest bonds and other fixed income products and financial derivatives (such as forward, options, swaps, etc.) together to form a new type of financial products. Which is the combination of financial derivatives that isHook the subjectThe
When investing in such financial products, we must first understand the relationship between the underlying and the product's earnings, that is, how the performance of the underlying product is profitable; the second is to understand the past performance of the underlying mark, in order to form their own judgment on its future. The above two points is the investment structure of financial products in particular to pay attention. The more complex the underlying financial products,
The greater the risk, investors should try to choose a simple and clear product linked to the standard.
Classification of Financial Derivatives: Forward, Options, Swaps
Forward contracts and futures contracts are transactions in which both parties agree to trade at a particular time, at a particular price, for a particular quantity and quality asset.
Forward contract is based on the special needs of buyers and sellers by the buyers and sellers signed their own contracts. As a result, futures trading is highly liquid and forward transactions are less liquid.
Option trading is a trading right. An option contract specifies the right to buy and sell a particular quantity, quantity, and quality of a particular asset at a particular price at a particular price. The option contracts have standardized contracts listed on the exchange, as well as non-standardized contracts for trading at the counter.
A swap contract is a contract for the parties to the transaction to exchange assets at a certain time in the future. More precisely, a swap contract is a contract between the parties to exchange cash flows that they consider to have equal economic value in a future period. The more common is interest rate swaps and currency swaps. Swap currency is the same currency, the interest rate swap; is a different currency, then the currency swap.