Underlying Asset / Security

Also just the underlying or underlying instrument. The asset a derivative (like an option or futures contract) is based on.

For instance, the underlying for an IBM call option is the IBM stock. The underlying for VIX futures is the VIX index.

Generally, any asset can have derivatives on it and be the underlying for those derivatives. Common underlying assets for options and futures include stocks, stock indices, currencies, interest rates, bonds, or commodities.

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