Lisäjohdannaiset

Lisäjohdannaiset, a Finnish term, translates to "additional derivatives" or "further derivatives" in English. This concept generally refers to secondary or tertiary financial instruments derived from underlying assets. These instruments are not direct ownership stakes but rather contracts whose value is contingent upon the performance of other assets or indices.

In financial markets, lisäjohdannaiset can encompass a broad range of complex products. Examples include options on futures contracts, or swaps whose terms are based on the interest rate of another swap. The creation of these instruments often involves layering derivative contracts upon one another, increasing the complexity and potential leverage associated with them.

The purpose of lisäjohdannaiset can vary. They might be used for hedging purposes, allowing investors to protect against adverse price movements in their existing holdings. Alternatively, they can be employed for speculative strategies, aiming to profit from anticipated market fluctuations. Due to their intricate nature, lisäjohdannaiset typically require a sophisticated understanding of financial markets and risk management. Their valuation can be challenging, and they often carry higher risks compared to simpler financial products.