Plain vanilla as a financial instrument
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kennith
Apprentice
Joined: 08 Jan 2007
Posts: 1
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 Posted: 09/13/08 - 07:19 Post subject: |
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| There must be a whole army of people with more financial knowledge than I have here on the forum, so I have got high hopes that one of you is going to answer my question. I have heard something vague about plain vanilla, as a financial instrument or a type of financial instrument. Can you explain this? |
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averill
Apprentice
Joined: 07 Sep 2005
Posts: 1
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| Posted: 09/28/08 - 05:22 Post subject: |
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| A plain vanilla financial instrument is the most basic form of any financial instrument, no matter which one, it can apply to any kind. These are normally options, bonds or futures though. Another way to express plain vanilla would be "no frills", as banks sometimes say. It is the standard version of an instrument. |
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drusie
Apprentice
Joined: 02 Jul 2008
Posts: 1
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| Posted: 10/13/08 - 03:25 Post subject: |
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| A plain vanilla is the exact opposite of an exotic instrument - whereas one is the most basic and standard form is called plain vanilla, the more complex securities are referred to as exotic. Financial instruments can be as complex or straight forward as the bank and customer agree on, as you see. |
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