Derivatives products in emerging markets and prudential regulations

Mazin A.M. Al Janabi

Research output: Chapter in Book/Report/Conference proceedingChapter

Abstract

Trading of derivatives securities in emerging markets has gone through a few changes, however to asymmetrical measures contingent on each market's initial development in regulations, trading and operational platforms and management information systems. To this end, this chapter reviews some of the fundamental obstacles to the establishment of successful derivatives exchanges and products in emerging markets and recommends certain practical resolutions. This is with the aim of using efficient operational platforms, rigorous regulations and effective surveillance to discourage delinquencies and rogue trading within the financial service industry. The fundamentals of operational procedures documented in this chapter are based on the author's real-world experiences as a practitioner of derivative products and modern risk management principles. Furthermore, it is related to the author's research as an academic on derivative securities and sound risk management practices, as documented in Al Janabi (2006-2012) research papers. In particular, the chapter reviews fundamental regulatory guidelines and operational processes that should be evaluated before the launching of sound derivatives securities markets and products, above all in emerging markets backdrop. This chapter will be of interest to those involved in the process of setting sound and efficient regulatory and operational policies and procedures for intermediating in derivatives securities in emerging economies-predominantly given the aftermaths of the latest financial crisis.

Original languageEnglish
Title of host publicationEmerging Markets
Subtitle of host publicationRecent Developments, Challenges and Future Prospects
PublisherNova Science Publishers, Inc.
Pages81-111
Number of pages31
ISBN (Electronic)9781536130409
ISBN (Print)9781536130393
Publication statusPublished - Jan 1 2018
Externally publishedYes

Keywords

  • Banking
  • Derivative securities
  • Emerging markets
  • Financial markets and institutions
  • Financial regulations
  • Risk management
  • Trading operations

ASJC Scopus subject areas

  • General Economics,Econometrics and Finance
  • General Business,Management and Accounting

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