Financial products or instruments consist of all types of assets that can be traded on financial markets. There are many ways of classifying these products. For the purposes of this site, we prefer to keep it simple.

Securities, often called “paper”, encompass all direct financing instruments of businesses, banks, governments or public organisations. A security may consist of a short-term debt (negotiable debt instrument), long-term debt (bond), or part of a company's equity (shares). For the issuer of the security, it is a financing resource, whereas for the buyer, it is an investment.

The chapter entitled, “fixed-income and foreign exchange instruments” could have also been called “balance-sheet products.” We have included under this heading all transactions that are the object of immediate or deferred recording but which are current in the balance sheets of the players (purchase, sale and issuance of securities are also a part of this group, but we decided to place those under the heading, “securities”, given the breadth of the subject). Cash loans/borrowings or interest-rate products consist of the simplest part since they essentially entail the lending or borrowing of cash. Foreign exchange products encompass all firm buy or sell currency transactions.

Derivative products include all transactions referred to as off-balance sheet, since they are not posted on the balance sheet of financial statements. These are called “derivatives” because they are derived from traditional securities. Given the endless imagination of the markets, the number and variety of contingent products are nearly infinite, so it would be impractical to attempt an exhaustive presentation here. Moreover, derivatives often mix different types of underlying assets (referred to simply as “underlying”): stocks and bonds, currency and interest-rate products. We will present here some of the more common products on the market. But we are constantly adding new headings to this chapter.

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