The History of Financial Derivatives: A 2-Part Feature - Part 2: The Possibility That We are Coming Full Circle

6 Pages Posted: 2 May 2015

See all articles by Hilary Till

Hilary Till

Premia Research LLC; EDHEC-Risk Institute; J.P. Morgan Center for Commodities, University of Colorado Denver Business School; Global Commodities Applied Research Digest

Date Written: April 2014

Abstract

This 2-part series describes the emergence of financial derivatives after the collapse of the Bretton Woods accord in 1971. Part 1 explained the concepts that enabled financial derivatives markets to flourish, focusing on the required mathematical concepts. Part 2 continues with enumerating the business models that have been employed by successful commercial participants in the financial derivatives arena. Part 2 also briefly covers the development of over-the-counter financial derivatives, including their misuse during the lead-up to the Global Financial Crisis. The article concludes that we may be nearing the limits of what the power of mathematics can do to hedge, and thereby conquer, financial risk.

Keywords: hedging, regulatory, speculator

JEL Classification: G1, G18, N22, N2

Suggested Citation

Till, Hilary, The History of Financial Derivatives: A 2-Part Feature - Part 2: The Possibility That We are Coming Full Circle (April 2014). Available at SSRN: https://ssrn.com/abstract=2601047 or http://dx.doi.org/10.2139/ssrn.2601047

Hilary Till (Contact Author)

Premia Research LLC ( email )

United States
312-583-1137 (Phone)
312-873-3914 (Fax)

HOME PAGE: http://customindices.spindices.com/custom-index-calculations/premia/all

EDHEC-Risk Institute

Nice
France

HOME PAGE: http://risk.edhec.edu/

J.P. Morgan Center for Commodities, University of Colorado Denver Business School ( email )

1475 Lawrence St.
Denver, CO 80202
United States

HOME PAGE: http://www.business.ucdenver.edu/commodities

Global Commodities Applied Research Digest ( email )

J.P. Morgan Center for Commodities
1475 Lawrence Street
Denver, CO 80202
United States

HOME PAGE: http://www.jpmcc-gcard.com/hilary-till

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