Negotiable instrumentsNegotiable instruments are freely transferable commercial documents, and each type of negotiable instrument has unique functions and features. Negotiable instruments are is a commercial document that satisfies certain conditions and transferable either by the application of law as by the custom of bleed concerned. This instrument can be transferred freely from hand to hand and has a legal life that can be transferred by more delivery or endorsement. Most Common Types of Negotiable Instruments are;Promissory notes. Bill of exchange. ChequeDemand DraftGovernment promissory notes. Delivery orders. Customs Receipts. Most negotiable instruments fall under the following two categories; the Negotiable instrument by statute and Negotiable instruments by custom or usages. Non-negotiable securities and products are those that cannot be transferred from one party to the next. An example of a non-negotiable instrument also referred to as a non-marketable instrument, would be a Mutual Fund.