n NISM Certifications
XXI NISM Series XXI-A
Medium

Which of the following is TRUE about 'Derivatives'?

Practice question from NISM XXI A for PMS - Mock Test 2 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. They derive their value from an underlying asset

    Correct answer

  2. B

    They eliminate all types of risks from the market

  3. C

    They are only used for hedging purposes

  4. D

    They have no role in price discovery

A full explanation for this question is being written. In the meantime, the correct answer is highlighted above.

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