derivatives
derivatives
Pronunciation
IPA: /dɪˈrɪvətɪvz/
Syllable Breakdown:
de- /dɪ/: The "d" sound as in "dog" followed by the "i" sound as in "sit."
riv- /ˈrɪv/: The "r" sound as in "red," the "i" sound as in "sit," and the "v" sound as in "van."
a- /ə/: The schwa sound, a soft, unstressed "uh" sound.
tives /tɪvz/: The "t" sound as in "top," the "i" sound as in "sit," the "v" sound as in "van," and the "z" sound as in "zoo."
Word Form Variations
Singular Noun: derivative
Plural Noun: derivatives
Adjective: derivative
Verb: derive (the root verb from which the noun is formed)
Definitions, Synonyms and Antonyms
Noun
A product, substance, or financial asset that is created or developed from another, more fundamental source.
Synonyms: byproduct, offshoot, spinoff, outgrowth, descendant
Antonyms: original, source, origin, basis, foundation
A financial contract whose value is determined by the performance of an underlying asset, such as a stock, bond, or commodity. These are often used for hedging risk or for speculation.
Synonyms: financial instrument, financial contract, security
Antonyms: asset (in the sense of the underlying asset itself), direct investment
Adjective
Lacking originality; based on or copied from a pre-existing source.
Synonyms: unoriginal, imitative, uninspired, secondary, copied
Antonyms: original, unique, creative, innovative, pioneering
Examples of Use
Newspaper and Financial Publications
"The central bank has been monitoring the risk posed by complex financial derivatives that are not traded on public exchanges." (Financial Times, May 2024)
"The company's revenue growth was driven by its new line of food products, which are all derivatives of its classic flagship brand." (Wall Street Journal, October 2023)
Books
"His writing style was criticized for being too derivative of a generation of modernist poets who had come before him." (from "The Unfolding of a Generation," a work of literary criticism)
"The first step in understanding the financial crisis is to get a grasp of how mortgage-backed securities and other complex derivatives contributed to the systemic collapse." (from "A Brief History of Economic Disasters")
Online Publications and Blogs
"Many synthetic plastics are derivatives of petroleum, a fact that has significant environmental implications." (Scientific American, January 2024)
"The band's new album is a highly derivative work, borrowing heavily from 1990s grunge and punk." (Pitchfork, February 2024)
Entertainment
"The film was lambasted by critics for being a lazy and derivative action movie, recycling tropes from countless other blockbusters." (Rolling Stone, April 2024)
"We can see how a simple folk tune can be the source of countless derivatives, each one transforming the original in a new way." (NPR Music, November 2023)
General Public Discourse
"I feel like a lot of modern pop music is just a derivative of older genres, with not much new to say."
"Be careful with that investment; it's a derivative, and the value is tied to a bunch of other things you can't control."
10 Famous Quotes Using Derivatives
“I view derivatives as time bombs, both for the parties that deal in them and the economic system.” (Warren Buffett)
"By far the most significant event in finance during the past decade has been the extraordinary development and expansion of financial derivatives." (Alan Greenspan)
“Derivatives are financial weapons of mass destruction.” (Warren Buffett)
“What we have found over the years in the marketplace is that derivatives have been an extraordinarily useful vehicle to transfer risk from those who shouldn't be taking it to those who are willing to and are capable of doing so.” (Alan Greenspan)
“I believe that writing is derivative.” (Charles Kuralt)
"There must be some Tommy Hilfiger event horizon, beyond which it is impossible to be more derivative, more removed from the source, more devoid of soul." (William Gibson)
“Money never seems to be interested in strengthening regulatory agencies, for example, but always in subverting them, in making them miss the danger signs in coal mines and in derivatives trading and in deep-sea oil wells.” (Thomas Frank)
“The discussion of derivatives in the political world has become a zero sum game.” (Judd Gregg)
"Derivatives are like sex. It’s not who we’re sleeping with, it’s who they’re sleeping with that’s the problem." (Warren Buffett)
“The marginal people on the trading desks, there's no skill set; if they don't trade derivatives, I don't know what they can do.” (James Chanos)
Etymology
The word "derivatives" has a history that starts with a simple, physical action: drawing water from a source.
The word comes from the Latin verb dērivāre, which literally meant "to draw or divert water from a stream or river." The Latin word itself is a combination of two parts:
dē-: a prefix meaning "from" or "away from."
rīvus: the Latin word for a "stream" or "channel."
So, at its core, to "derive" meant to create a new channel to move water away from its original source.
When the word entered the English language in the 14th century, it kept this central idea but became a metaphor. To "derive" something meant to "obtain or get something from a source." For example, you might "derive pleasure from a good book" or "derive an idea from an earlier concept."
The noun "derivative" (meaning "something that comes from a source") first appeared in the late 16th century. It described anything that was produced or developed from something else.
This core meaning is still true today, and it helps explain all the different uses of the word:
In general language: A derivative work of art is one that takes its inspiration or style from an earlier artist.
In math: A derivative in calculus is a mathematical function that comes from another function and describes its rate of change.
In finance: A financial derivative is a contract whose value is "derived" from an underlying asset, like a stock or a commodity.
In all these cases, the "derivative" is something that has been "drawn from" or "obtained from" an original source.
Phrases + Idioms Containing Derivatives
Financial derivatives: The most common phrase, referring to financial instruments.
Derivative markets: The specific trading environments for these financial instruments.
A derivative work: An established legal and artistic term for a work of art or literature based on one or more pre-existing works.
A derivative of a function: A key phrase in calculus.
A derivative product: A term used in business and manufacturing for a product that comes from a parent product.
Caught in the crossfire of derivatives: An original phrase to describe being affected by the complex and unpredictable nature of financial contracts.
A work that is a blatant derivative: A phrase of literary or artistic criticism.
An imitative spin-off: An idiom using a synonym ("imitative") and a related term ("spin-off") to convey a similar meaning.
Singing a secondhand song: An idiom using a synonym ("secondhand") to describe a creation that is not original.
Vocabulary-Based Stories from SEA
Source Information
Definition of derivatives from The Academic Glossary at Self Exploration Academy, a Urikville Press Publication. © All rights reserved.
