Question

What are the underlying assets for a derivative instrument?

Answer 1

                 ıllıllı ʜᴇʀᴇ ɪs ʏᴏᴜʀ ᴀɴsᴡᴇʀ ıllıllı

I think you're asking this in context of derivatives. Derivatives are instruments to protect you from unexpected fluctuations in price of assets you own.

Example :

You have a share of Apple at price 100, now you are worried that price of share might go down tomorrow for any reason (let's say result of a litigation will be announced). You are worried that shares may fall drastically if decision is against Apple. You can mitigate the risk by buying today a put option which gives you option to sell share at a particular price.

Primary assets.

Underlying assets are the primary assets. From these assets, the value is aggregated to secondary assets which we popularly call derivatives.

Secondary assets

In case of secondary assets or derivatives as stock options, the underlying asset is identified as the stock itself.

ᴇʜsᴀss  ^_^