A non-derivative financial asset is a financial asset that do not derive value from an underlying asset or derivative contract. Non-derivative financial assets represent standalone financial assets (financial products or instruments) with intrinsic value that is derived from a monetary basis (monetary asset such as cash or cash equivalent– bank deposit) or contractual claim (securities: bonds and stocks). The contractual claim gives a holder the right to receive an amount of money (cash or otherwise) or another financial asset from another party or to exchange financial assets/ financial liabilities with another party under favorable conditions.
Other examples of non-derivative financial assets include:
- Loans.
- Trade receivables and other receivables,
- Cash and cash equivalents.
- Long-term debt.
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