Module 6

• Forwards. A customized contract between 2 parties to buy or sell an asset at a specified future date
• Futures. Like forwards but are standardized and regulated agreement to buy or sell an asset at a future date at an agreed upon price.
• Options. A contract that gives the right but not the obligation to buy (call) or sell (put) a security or other financial asset.
• Swaps. The exchange of one for another, based on different factors.
• The foreign exchange market is the "place" where currencies are traded. Currencies are important to most people around the world, whether they realize it or not, because currencies need to be exchanged to conduct foreign trade and business.
• The spot market is where currencies are bought and sold according to the current price. That price, determined by supply and demand, reflects many things, including current interest rates, economic performance, sentiment towards ongoing political situations (both locally and internationally), as well as the perception of the future performance of one currency against another.
• Real estate investing involves the purchase, ownership, management, rental and/or sale for profit. Improvement of as part of a strategy is generally considered to be a sub‐ specialty
• Of all the precious metals, gold is the most popular as an investment. Investors generally buy as a way of diversifying risk, especially using futures contracts and derivatives.
• Not all equities are listed on stock exchanges. Private Equity refers to funds that institutional investors or high net worth investors directly

  place in companies or in the process of buyout of public companies.
• HEDGE FUNDS These funds derived this name due to their core idea to generate a consistent return and preserve capital, instead of focusing on the magnitude of returns.
• Venture Capital usually invests at seed and early‐ stage businesses while some invest at the expansion stage. The investment horizon is typically between 3‐7 years and venture capitalists expect returns to the tune of >8x‐10x the invested capital
• Currencies are important to most people around the world, whether they realize it or not, because currencies need to be exchanged to conduct foreign trade and business.
• Common underlying instruments include bonds, commodities, currencies, interest rates, market indexes, and stocks.
• Derivatives contract between two or more parties whose value is based on an agreed‐upon underlying financial asset (like a security) or set of assets (like an index). Common underlying instruments include bonds, commodities, currencies, interest rates, market indexes, and stocks.
• financial derivative A contract whose value based on something else. Any security whose value is determined by, or derived from, the value of another.