Derivative Instruments


Appraise the uses of derivative instruments to construct practical applications for investors.


You have just completed your second training for the new class of interns at your employer, Bank of Wealth Investment Brokers. You have now been asked to create a memo to a prospective client about the strategies used with derivative instruments.

You will need to develop a memo that distinguishes the forms of derivatives. A memo will provide brief and clear information on the required subject. Often, short phrases and paragraphs are used in a memo; however, since the client will expect to know and understand the material thoroughly from your memo, it should be more detailed and offer supporting evidence, including a reference list.

  1. The memo should give the interns enough information to understand the similarities and differences between the various forms of derivatives. Be sure to use audience-specific language and tone in the memo. Remember, you are writing this memo for the client; however, the Portfolio Manager may read it.
  2. Be creative, and make your memo fun, yet still clearly organized. In addition, you can use this link for help on writing memo.