Underlying asset
- Japanese
- 原資産
- Last reviewed
- September 24, 2026
This is a draft, shown for review before publication.
An underlying asset is the asset or indicator on which the profit or loss of a derivative is based. Besides financial instruments such as stocks, bonds, and foreign currencies, indicators such as the level of interest rates, temperature, and rainfall can be underlying assets.
Related terms
Explained in detail
Pages that use this term
- Probability and Statistics Basics
- Introduction to Stochastic Calculus (Ito's Lemma)
- How Hedge Funds Use Derivatives
- Hedging, Speculation and Arbitrage
- Forwards and Futures
- Option Basics: Calls and Puts
- Option Payoffs and Profit/Loss
- Exercise Styles: European, American and Bermudan
- Put-Call Parity
- Option Strategies
- Overview of Exotic Options
- Barrier Options
- Digital Options
- Asian Options
- Lookback Options
- Basket Options
- Quanto Options
- Caps and Floors
- Swaptions
- Overview of Exotic Rate Products
- CMS Spread Options
- FX Options
- FX Option Market Conventions
- Equity Index Options
- Single Stock Options
- Overview of Exotic Equity Products
- Dividend Swaps and Futures
- Variance Swaps and Volatility Swaps
- Cliquets
- Autocallables
- Overview of Commodity Derivatives
- Agricultural Commodities
- Weather Derivatives
- Property Derivatives
- Freight Derivatives (FFA)
- Callable Bonds and Early Redemption Features
- Convertible Bonds (CB)
- No-Arbitrage and Replication
- Binomial Trees
- Risk-Neutral Valuation
- The Black-Scholes Model
- The Greeks
- Implied Volatility
- Volatility Smiles and Surfaces
- The Black and Bachelier Models
- ISDA SIMM: The Standard Model for Initial Margin
- FVA and MVA
- The SABR Model
- Local Volatility Models
- The Heston Model
- Model Calibration
- Monte Carlo Simulation
- Finite Difference Methods
- Delta Hedging
- Managing Gamma and Vega
- Hedging Exotic Products
- Market Making
- Volatility Trading
- Sensitivities: DV01, Vega and Key Rate Sensitivities
- Funding Variation and Initial Margin
- P&L Attribution
- Lifecycle Event Processing
- Choosing the Booking Entity
- The Financial Instruments and Exchange Act and Derivatives
- EMIR
- MiFID II and MiFIR
- PRIIPs
- The Fundamental Review of the Trading Book (FRTB)
- The Standardized Approach for Counterparty Credit Risk (SA-CCR)
- Singapore
- China
- South Korea
- Market Manipulation and Spoofing
- Crypto-Asset Derivatives
- Digitalization: CDM and Tokenization