Which of the following is a characteristic of a derivative?

Question

Quizplus · Accepted Answer

All of the given choices are characteristics of derivatives. 
A) Derivatives have one or more underlying assets, such as stocks, bonds, commodities, or currencies.
B) Derivatives have one or more notional amounts, which is the nominal or face amount used to calculate payments.
C) Derivatives involve an exchange of promises or contractual obligations between two counterparties.
D) Derivatives can require or permit a net settlement, which can reduce credit risk and simplify payment arrangements.

Which of the Following Is a Characteristic of a Derivative