9 Financial instruments vocabulary

Various assets or securities that can be traded.

security – a financial asset like a stock or bond that can be traded.

bond – a fixed income instrument representing a loan made by an investor to a borrower.

stock – a type of security representing ownership in a corporation.

derivative – a financial instrument whose value is derived from other assets.

option – a contract giving the right but not the obligation to buy or sell an asset at a set price.

warrant – a derivative that gives the right to buy securities at a certain price.

convertible bond – a bond that can be converted into a predetermined amount of the issuer's equity.