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    Question

    The underlying asset of a derivative contract can be

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    A Equity shares Correct Answer Incorrect Answer
    B Interest rate Correct Answer Incorrect Answer
    C Currency Correct Answer Incorrect Answer
    D Commodities Correct Answer Incorrect Answer
    E All of the above Correct Answer Incorrect Answer

    Solution

    The underlying security is often referred to simply as "the underlying." An underlying security can be any asset, index, currency, commodity, financial instrument or even another derivative.

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