Question

An option is simply a derivative security, where price depends on the price of other securities or assets.

A. Independent security
B. Standalone security
C. Derived security
D. Dependent security

Answer 1

An option is a derived security, which means that its value is based on another asset. It grants the right to buy or sell this underlying asset at a set price within a specified time frame. Option c

Step-by-step explanation:

An option is classified as a derived security, meaning its value is based on the price of some other asset, typically stocks, bonds, commodities, or market indices. The correct answer here is C. Derived security.

Options give the holder the right, but not the obligation, to buy or sell an underlying asset at a specified strike price on or before a specified date. They are part of a larger group of financial instruments known as derivatives, which also includes futures, forwards, and swaps. Option c