Abstract
Derivatives markets have long ago started to be an important part of the global market in general and international monetary relations in particular. They make the process of risk management more advanced. It helps bringing the global monetary relations to a higher development level. Global trade in derivatives performs the functions of integration of regional capital markets and helps the global economy participants reduce available risks and concentrate on the further development of international trade and monetary relations. Therefore, the derivatives market contributes to reducing the risk level and balancing the international capital flow. Modern world trends in the derivatives’ market development are studied. The structure of the world derivatives market is determined with the separation of its exchange and over-the-counter parts. The instrumental structure of the market is analyzed with the separation of the most popular underlying assets among the derivatives market participants. The author notes that the share of interest rate and foreign exchange derivatives is constantly growing, with an advantage on the side of interest rate derivatives. The paper determines that there is a gradual shift of trade from exchanges to the over-the-counter market in the market of interest derivatives due to the passage of transactions through central counterparties, as well as the growing share of electronic and automatic trading. Analysis of the dynamics of foreign exchange derivatives reveals that contracts increasingly include currencies that do not belong to the top four (USD, EUR, JPY, GBP). At the same time, the US dollar remains the leading currency in operations with interest rate and foreign exchange derivatives. The cross-border operations with derivatives are analyzed. The paper proves that the global nature of the modern derivatives market can be supported by the recognition and implementation of global standards and the cooperation of regulators around the world.
Published Version
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