Articles on Derivatives

What Are Derivatives ?

If you are connected to any kind of financial market or watch the financial news even for 5 minutes every...

The Need for Derivatives

In the previous article, we discussed as to how derivatives contracts can be dangerous and can pose a systemic risk....

History of Derivatives

Derivatives may have found their way into the media in very recent times. However, they have been used by mankind...

The 4 Basic Types of Derivatives

In the previous articles we discussed about what derivative contracts are and what are the uses of such contracts? However,...

Risks Involved in Derivative Contracts

Derivatives are considered to be extremely risky. The market is divided in two fronts when it comes to the opinion...

Commonly Used Terms in Derivative Market

The derivative market can seem like a world unto itself. The market is so large and so different from the...

Exchange Traded Derivatives

Now since we have a basic idea regarding what derivatives really are and the function that they perform, it time...

Margin Mechanism in Exchange Traded Derivatives

When it comes to exchange traded derivatives, one of the first things that need to be understood is the margin...

Examples of Exchange Traded Derivatives

In the previous article, we studied about exchange traded derivatives. We studied their defining features and found out the reason...

Securitization: The Making of an Exchange Traded Derivative

The modern financial system is all about innovation. The system and its proponents believe that financial jugglery can solve almost...

Notional Value: Derivatives Markets

People often say that the size of the derivative markets is exploding. It is over $700 trillion dollars a year...

Over the Counter Derivatives Regulation

The derivatives markets all over the world have been under fire after the 2008 crisis. There is increasing clamor and...

Financial and Economic Models used in the Equity and Currency Markets

We often read about how electronic and software based trading is the norm in stock or equity markets as well...

An Introduction to Hedge Funds

The term “hedge funds” have become ubiquitous in the financial markets nowadays. This is a term which incites a strong...

How Hedge Funds Makes Money ?

The inner workings of hedge funds are as elusive as their outward appearance. The general public usually does not know...

Types of Hedge Funds

Hedge funds are simply funds with high leverage and no regulation. They have come into existence in the past couple...

Why Hedge Funds Fail ?

Hedge funds are considered to be the riskiest of all asset classes. Almost everybody considers hedge funds to be completely...

Hedge Funds vs. Mutual Funds

Hedge funds are both exclusive as well as elusive. They differ from other funds like mutual funds in a large...

Hedge Funds and Money Laundering

Money laundering is a heinous crime. Although it does not directly lead to loss of human lives, it allows money...

Hedge Funds and Regulations

Technically, the term hedge fund does not exist. In fact, the term hedge fund applies to any fund which is...

Hedge Funds and Conflict Of Interest

Hedge funds are often looked upon as being unethical in their practices. This is partly because there is public outrage...

Hedge Funds and Leverage

Leverage is one of the defining features of any hedge fund. Therefore hedge funds have gained expertise in the creation...

Structuring a Hedge Fund Business

A successful business is built before there is one. The way any business is structured has very long term implications...

Vulture Funds: The Name Says It All

What Do Vulture Funds Do ? Countries and companies are in turmoil all the time. When entities are close to...

What is Prime Brokerage ?

History of Prime Brokerage The growth in the number of hedge funds as well as the scale of their operations...

What is Algorithmic Trading ?

Algorithmic trading was considered to be a bookish concept developed by geeks. Less than a decade ago, mainstream traders at...

Extrapolation: The Root Cause behind the Bubbles

They say that there is no smoke without fire. This is true of many things and one of them is...

Why Do Mutual Funds Lend To Promoters?

After the banking crisis, the Indian capital markets are facing another dire situation. It has recently come to light that...

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Articles on Derivatives