Primary Instrument

A financial investment whose price is based directly on its market value. Examples of primary instruments include stocks, bonds, certificates of deposit, bills and anything else that has its own value. By contrast, the price of derivative instruments, such as options, swaps and futures, is based on the value of their underlying assets.

While the markets have established hundreds of instruments to facilitate the flow of capital and the management of risk, primary investments like stocks are what most beginning investors think of when they think about investing. This is because investing in primary instruments requires only basic knowledge of markets and investment principles.

A non-primary instrument would be something like a call option, which gives the owner the right to purchase the underlying stock at a certain price. So, if the price of the stock goes up, the call option's value also goes up. The call's value is based on the value of something else so it is not a primary instrument.


Investment dictionary. . 2012.

Look at other dictionaries:

  • Primary instrument — A primary instrument is a scientific instrument, which by its physical characteristics is accurate and is not calibrated against anything else. A primary instrument must be able to be exactly duplicated anywhere, anytime with identical… …   Wikipedia

  • instrument operations — Arrivals or departures of an aircraft in accordance with an IFR (instrument flight rules) flight plan or special VFR (visual flight rules) procedures, or an operation where IFR separation between aircraft is provided by a terminal control… …   Aviation dictionary

  • Instrument flight rules — (IFR) are a set of regulations and procedures for flying aircraft whereby navigation and obstacle clearance is maintained with reference to aircraft instruments only , while separation from other aircraft is provided by Air Traffic Control. In… …   Wikipedia

  • Instrument avion — Instrument de bord (aéronautique) Les instruments de bord servent à présenter au pilote toutes les informations qui lui sont utiles au maintien en vol de son avion, à sa navigation, à ses communications avec les infrastructures de la gestion du… …   Wikipédia en Français

  • Instrument de bord — (aéronautique) Les instruments de bord servent à présenter au pilote toutes les informations qui lui sont utiles au maintien en vol de son avion, à sa navigation, à ses communications avec les infrastructures de la gestion du trafic aérien et lui …   Wikipédia en Français

  • Instrument de bord (aeronautique) — Instrument de bord (aéronautique) Les instruments de bord servent à présenter au pilote toutes les informations qui lui sont utiles au maintien en vol de son avion, à sa navigation, à ses communications avec les infrastructures de la gestion du… …   Wikipédia en Français

  • Instrument landing system — The Instrument Landing System (ILS) is a ground based instrument approach system that provides precision guidance to an aircraft approaching a runway, using a combination of radio signals and, in many cases, high intensity lighting arrays to… …   Wikipedia

  • instrument — noun 1 tool for a particular task ADJECTIVE ▪ precision, sensitive ▪ sophisticated ▪ reliable ▪ crude ▪ blunt …   Collocations dictionary

  • Instrument de bord (aéronautique) — Les instruments de bord servent à présenter à l équipage, en particulier au pilote, toutes les informations utiles au maintien en vol de l aéronef, à la navigation, aux communications avec les infrastructures de la gestion du trafic aérien. Les 4 …   Wikipédia en Français

  • Primary auditory cortex — Infobox Brain Name = Primary auditory cortex Latin = GraySubject = GrayPage = Caption = Brodmann areas 41 42 of the human brain. Caption2 = The Primary Auditory Cortex is highlighted in magenta, and has been known to interact with all areas… …   Wikipedia

Share the article and excerpts

Direct link
Do a right-click on the link above
and select “Copy Link”

We are using cookies for the best presentation of our site. Continuing to use this site, you agree with this.