Equity futures

Equity futures



The impact of innovation in equity derivatives contracts on the volatility of the underlying stocks has become a particular focus of attention for observers of the stock market. Although the hedging activities of large institutional investors account for a major component of the market volume, stock index futures trading has also attracted speculators and small traders. Some commentators argue the participation of such traders may enhance underlying volatility in the stock market. One result of this concern has been the imposition of regulations designed to control potentially destabilizing trader behavior. These include increasing the level of margin requirements, ...