This 2-part series discusses the emergence of financial derivatives after the collapse of the Bretton Woods accord in 1971. In Part 1, the article explains the concepts that enabled financial derivatives markets to flourish, focusing on the required mathematical concepts. Part 2 continues with...

As a result of the current financial crisis, there have been many calls for strict new regulation of over-the-counter financial derivatives. This paper proposes, instead, that we return to the now-voided common law on derivatives and consider them non-legally enforceable gambling contracts...

Future markets are the result of trying to eliminate or reduce risk, i.e. an attempt to avoid instability of prices in international business. Since trading on future markets reduces the risk of business, it significantly increases the scope of trade and number of stakeholders, which logically...

The global financial crisis (GFC) that the whole world was confronted with in 2007/09 proved to be an event of unprecedented severity that revealed major complications arising due to a combination of omissions, inattentiveness, a lack of understanding and even greediness on the part of market...

Over the last decade, the derivatives market has witnessed a collapse of covered interest parity (CIP) which has unlocked a stream of arbitrage opportunities across currencies for investment managers. In this paper, we introduce two new factors --- inflation differential and relative economic...

Variations in fine wine prices can be prominent and have widespread economic and financial implications. Although fine wine investments are dominated by French wines, we demonstrate that significant international diversification benefits exist for investors in Italian, Australian and Portuguese...