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Complex derivatives

The intrinsic complexity of the financial derivatives market has emerged as both an incentive to engage in it, and a key source of its inherent instability. Regulators now faced with the challenge of taming this beast may find inspiration in the budding science of complex systems.

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Figure 1: The largest players in the derivatives market.


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The authors acknowledge support from the European FET Open Project FOC 'Forecasting Financial Crises' (No. 255987) and from the Working Group on Networks and Systemic risk, part of the Institute for New Economic Thinking's Financial Stability Research Program.

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Correspondence to Stefano Battiston.

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The views expressed in this Commentary do not necessarily reflect the views of Deutsche Bundesbank or the European System of Central Banks.

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Battiston, S., Caldarelli, G., Georg, CP. et al. Complex derivatives. Nature Phys 9, 123–125 (2013).

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