PROBLEMS AND PROSPECTS OF FINANCIAL DERIVATIVES MARKET DEVELOPMENT

Abstract

The article studies the problems and prospects of the financial derivatives market development. Globalizing the economic space contributes to transforming the stock market into the principal source of capital allocation. Still, the current conditions of the derivatives market in Ukraine do not correspond to the needs of the national economy, which requires strengthening the regulation of their activities to ensure the hedging of risks of market participants. The article analyses the dynamics of derivatives trading in the global exchange market, assesses the dynamics of world exchange trading in financial derivatives, and analyses the turnover of OTC derivatives in the EU. It also studies the dynamic changes in the amounts paid under the terms of contracts for derivative securities in the world by maturity, region and industry sector; the dynamics of options and futures trading in the global exchange market. In this analysis, we examine the trading volumes of derivatives within the financial market of Ukraine. We estimate the volume of trading within both exchange and over-the-counter markets, and present the dynamics of exchange contracts as well as the share of financial instrument trading in the securities market. The factors hindering the development of the derivatives market in Ukraine are identified. These factors include legislative shortcomings, the current level of derivatives market infrastructure, and the current state of development of the underlying asset markets. The article also analyses the derivatives market and provides prospects for its development. To ensure the future development of the financial derivatives market in Ukraine, it is essential to take certain measures. These include comprehensive regulation of the derivatives market, ensuring the operation of regulated markets and building their infrastructure, and introducing appropriate instruments to protect participants and hedge risks.