Other forms: derivatives; derivatively

Alert: shifting parts of speech! As a noun, a derivative is kind of financial agreement or deal. As an adjective, though, derivative describes something that borrows heavily from something else that came before it.

The economic meltdown of the last decade is due largely to the mismanagement of derivatives, which are deals based on the outcome of other deals. A movie plot might be described as derivative if it steals from another film — say, if it lifts the tornado, the witch, and the dancing scarecrow from The Wizard of Oz.

Definitions of derivative
  1. noun
    a compound obtained from, or regarded as derived from, another compound
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    type of:
    chemical compound, compound
    (chemistry) a substance formed by chemical union of two or more elements or ingredients in definite proportion by weight
  2. noun
    the result of mathematical differentiation; the instantaneous change of one quantity relative to another; df(x)/dx
    synonyms: derived function, differential, differential coefficient, first derivative
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    the rate of change (at a point) of the angle between a curve and a tangent to the curve
    partial, partial derivative
    the derivative of a function of two or more variables with respect to a single variable while the other variables are considered to be constant
    type of:
    calculation, computation, figuring, reckoning
    problem solving that involves numbers or quantities
  3. noun
    a financial instrument whose value is based on another security
    synonyms: derivative instrument
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    show 11 types...
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    futures contract
    an agreement to buy or sell a specific amount of a commodity or financial instrument at a particular price on a stipulated future date; the contract can be sold before the settlement date
    the right to buy or sell property at an agreed price; the right is purchased and if it is not exercised by a stated date the money is forfeited
    naked option
    a put or call option for which the seller or buyer has no underlying security position
    covered option
    a put or call option backed by the shares underlying the option
    call, call option
    the option to buy a given stock (or stock index or commodity future) at a given price before a given date
    put, put option
    the option to sell a given stock (or stock index or commodity future) at a given price before a given date
    the option to buy or sell a given stock (or stock index or commodity future) at a given price before a given date; consists of an equal number of put and call options
    incentive option, incentive stock option
    an option granted to corporate executives if the company achieves certain financial goals
    stock-index futures
    a futures contract based on a stock index; a bet on the future price of the indexed group of stocks
    stock option
    the right to buy or sell a stock at a specified price within a stated period
    lock-up option
    an option to buy the crown jewels offered to a white knight in order to forestall a hostile takeover
    type of:
    instrument, legal document, legal instrument, official document
    (law) a document that states some contractual relationship or grants some right
  4. noun
    (linguistics) a word that is derived from another word
    “`electricity' is a derivative of `electric'”
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    type of:
    a unit of language that native speakers can identify
  5. adjective
    resulting from or employing derivation
    “a derivative process”
    “a highly derivative prose style”
    formed or developed from something else; not original
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DISCLAIMER: These example sentences appear in various news sources and books to reflect the usage of the word ‘derivative'. Views expressed in the examples do not represent the opinion of or its editors. Send us feedback
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