An Instrument That Cannot Easily Be Transferred in the Ordinary

question 7

True/False

An instrument that cannot easily be transferred in the ordinary course of business can still be negotiable.

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Definitions:

Derivative Instrument

A financial security whose value is dependent upon or derived from an underlying asset or group of assets.

Options Contract

A financial derivative that gives the buyer the right, but not the obligation, to buy or sell an asset at a set price on or before a given date.

Future Contract

A standardized legal agreement to buy or sell something at a predetermined price at a specified time in the future.

Swap Contract

A financial derivative agreement between parties to exchange cash flows or other financial instruments over a specified time period.