Oddly they don't criticise the banks or ratings agencies for buying derivatives they didn't understand, wrecking the world economy.

Mr. Krapels said some companies might have become wary of hedging after buying derivatives to protect themselves, only to find that oil prices would fall.

No doubt bad publicity about money managers who bought derivatives has scared some of them away from the market.

The fund also bought derivatives, which are financial instruments whose value depends on the performance of underlying assets like stocks or bonds.

The companies buy derivatives whose value will rise if interest rates move in a way that causes them to lose money on their portfolio of mortgages.

She received offers to buy derivatives known as inverse floaters and interest-only strips, which are now big money losers.

Loopholes created because antiquated rules survive into an era of computer spreadsheets allow investors to buy financial derivatives that let them escape capital gains taxes.

A similar issue arose with corporations that bought derivatives designed to protect their profits from ups and downs in bond and stock markets.

But several clients of Bankers Trust bought derivatives that, instead of protecting them, triggered huge losses when interest rates went up.

A synthetic position can be created by buying or selling the underlying financial instruments and/or derivatives.