Financial derivatives refer to financial products based on traditional financial products such as currency, bonds and stocks and characterized by leveraged credit transactions.

The function of financial derivatives is to avoid risks, and price discovery is a good way to hedge asset risks. However, everything has its good side and bad side. If the risk is avoided, someone must bear it. The high leverage of derivatives is to transfer huge risks to those who are willing to bear them. Such traders are called speculators, while those who avoid risks are called hedgers and others are called arbitrageurs. These three types of traders * * * all maintain the above functions of financial derivatives.

(1) can be divided into four categories according to product form: forward, futures, options and swaps.

(2) According to the primary assets, it can be roughly divided into four categories, namely, stocks, interest rates, exchange rates and commodities.

(3) According to the transaction method, it can be divided into on-site transaction and off-site transaction.

Funds have broad and narrow definitions. A fund in a broad sense refers to a certain amount of funds set up for a certain purpose. An investment method that combines everyone's strength, risk and income. For example, trust and investment funds, unit trust funds, provident funds, insurance funds, retirement funds and funds of various foundations. Funds in the existing securities market, including closed-end funds and open-end funds, have the characteristics of income function and value-added potential. From the accounting point of view, capital is a narrow concept, which refers to funds with specific purposes and uses. Because the investors of government agencies and institutions do not require investment returns and investment recovery, but require funds to be used for designated purposes in accordance with the law or the wishes of the investors, funds are formed.

If you have a sum of money and want to invest in bonds, stocks and other securities to realize value-added, but you have no energy, professional knowledge and little money, you want to invest in partnership with other people 10 and hire an investment expert to operate the assets invested by everyone to realize value-added. But there, if investors above 10 consult with investment experts at any time, it will not be chaotic, so they will choose a person who knows best to take the lead in this matter. Give him a certain proportion of assets from everyone on a regular basis, and he will pay a high fund-raiser service fee on his behalf. Of course, he will take the lead in organizing all kinds of things, including running errands from house to house, reminding the master of risks at any time, and regularly announcing the investment profits and losses to everyone. , so I didn't come for nothing, and the money in the commission also has his service fee. These things are called partnership investment.

Financial management is a relatively broad concept. There are many kinds of financial management, and the fund industry can invest as financial management products. The risk is relatively small and the income is relatively stable.