The call option purchased by ABC Inc is an example of a financial derivative, even if it is expected not to be exercised.

The calculation of the financial instrument is as follows:

Option premium paid = $ 100 x 100 (lot size) = $ 10,000

Since the call option is out-of-the-money and is not expected to be exercised, it has no intrinsic value. The entire option premium paid by ABC Inc represents the time value of the option.

In conclusion, even if the option is not exercised, it is still a derivative because it derives its value from the underlying equity shares of X Inc.