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Negotiable Instrument - Definition

Written by Jason Gordon

Updated at December 6th, 2020

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What is a Negotiable Instrument?

An instrument refers to a document representing ownership of an underlying right or obligation. Instruments can refer to stocks, securities, commodities, derivatives, indexes, or any other similar asset. It can also consist of legal documents, contracts, deeds, and wills, among many others. An negotiable instrument is one that is traceable and capable of transfer or negotiation to another holder of the instrument. 

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