[Tuco-bad]

Derivatives are like options? or more complex than that?

Much much complex.

Derivatives could be an aggregation of options (calls & puts), futures, stock, real estate, currency etc.

Derivatives are so complex, that many a time the owner isn't quite sure as to if the investment is making or losing money.

And a significant change (e.g., price of oil, currency devaluation) could turn a big profit into a loss, or vice versa.

[wheels]

Derivatives are not complex at all. Moreover, they have existed in various forms for thousands of years and are necessary if you want to eat. If you quit watching Network News and read a book, you would not sound so uniformed.

Here is an example of a derivative.

Farmer Larry plants 100 acres of wheat every Spring. Each Spring he also agrees to sell that wheat at a certain price on a certain date in October, to a certain person. Farmer Larry has just entered into a derivatives contract.

There is probably a good chance your Utility bill is a derivative contract every month. If you agree to pay a fixed monthly rate, like I do, regardless of your amount of usage, then you have probably entered into a derivatives contract.