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Lesson 6. Stock Derivatives > What Are Derivatives? - Pg. 27

27 Chapter 6. Stock Derivatives In this lesson you will learn about several methods people use to make profits from stock outside of capital gains and dividends. What Are Derivatives? People are constantly coming up with new and more amazing ways to make (and lose) money, and the world of stocks is no exception. In addition to proper stock as discussed in Lessons 4, "What Is a Stock?" and 5, "The Five Types of Stock," a number of other stock-like products have appeared in which people speculate and invest. These products, while not exactly stocks, are directly based on stocks or are otherwise traded in stock markets. Or, they are derived from stocks. Because of these characteristics, such products are often referred to as derivatives (derived from--derivatives, get it?). Here are the various types of derivatives: · Subscription rights