Equities
Equity derivatives usually reference an individual stock, a group of stocks, or a stock index.
Fixed-Income Instruments
Bonds are a widely used underlying, and related derivatives include options, forwards, futures, and swaps. Government issuers, such as the US Treasury or Japanese Ministry of Finance, usually have many bond issues outstanding.
An interest rate is not an asset but rather a fixed-income underlying used in many interest rate derivatives.
A market reference rate (MRR) is the most common interest rate underlying used in interest rate swaps.
Currencies
Market participants frequently use derivatives to hedge the exposure of commercial and financial transactions that arise due to foreign exchange risk.
Commodities
Cash or spot markets for soft and hard commodities involve the physical delivery of the underlying upon settlement. Soft commodities are agricultural products, such as cattle and corn, and hard commodities are natural resources, such as crude oil and metals.
Credit
Credit derivative contracts are based upon the default risk of a single issuer or a group of issuers in an index. Credit default swaps (CDS) allow an investor to manage the risk of loss from borrower default separately from the bond market.
Other
Other derivative underlyings include weather, cryptocurrencies, and longevity, all of which can influence the financial performance of various market participants.
