Financial derivatives

Capital market inflation, financial derivatives and pension fund capitalism Jan Toporowski... 

Eventually, transparent pricing and trading could lead to the introduction of financial derivatives for some major chemical products such as methanol, low-density polyethylene and styrene. If a forward price curve were established for such products, manufacturers would be better able to time new asset investments and lock in margins through price guarantees on inputs and outputs. 

Merton, R., 1973. Theory of rational option pricing. Bell J. Econ. Manag. Sci. 4, 141-183. Neftci, S., 1996. An Introduction to the Mathematics of Financial Derivatives. Academic Press, San Diego. 

Neftci, S., 2000. An Introduction to the Mathematics of Financial Derivatives, second ed. Academic Press, San Diego. 

For other nonlinear curve modelling techniques see D. Satyajit, Risk Management and Financial Derivatives, (New York McGraw-Hill, Inc., 1998). 

Das, S. 1994. Swaps and Financial Derivatives, 2nd ed. London IFR Pubfishing. Decovny S. 1998. Swaps, 2nd ed. London FT Prentice Hall. 

Risk-mitigation tools Financial derivatives, property insurance Incident data and trend analysis Supplier contract reviews Self-assessment Contingency planning Scenario analysis New business and new venture audits Risk adjusted performance measures Advance warning systems Back-up of processes as well as dafa Ouarterly drills thaf include key partners... 

Unless embedded in fixed-income products, such as structured or credit-linked notes, the derivatives are off the balance sheet. This status endows them with tremendous flexibility and leverage, characteristics they share with other financial derivatives. 

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