Talk:Underlying asset

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Weather Derivatives

Weather Derivatives do not depend on a financial instrument, but on sunshine hours or other observed phenomena. I normally think of these as "Underlying" the derivative, but they are not assets. Do they deserve a mention here?

I think so, since the quant might think of the underlying asset as just the independent variable. So weather should be included. Paul 20:08, 26 October 2006 (BST)

I'm finding it difficult to come up with a generic term to replace 'financial instrument', perhaps something like 'observed quantity' or 'observed parameter'.--Radar 10:06, 27 October 2006 (BST)