In its third edition, this book not only expands and updates the presentation of financial derivatives but also seeks to answer questions regarding the reasons behind their staggering growth, their role in economic developments, their contribution to the evolution and management of global liquidity, and their involvement in financial and economic crises.

The book examines derivatives both as tools for hedging financial risks and as high-leverage investment products, as well as vehicles for creating capital-protected investment products. After referencing developments in the financial space and the contribution of derivatives to these, all categories of derivatives are presented and analyzed, using numerous examples and practical applications.

Options, futures contracts, swaps, forward contracts, specialized derivatives, and credit derivatives are examined, with particular reference to credit default swaps, collateralized debt obligations, and concepts such as credit event and risk premium.

Furthermore, issues related to the operation of derivatives are explored, including forward exchange rates, forward interest rates, and short selling. The book serves as a handy tool for professionals in the financial sector and is aimed at corporate executives, freelancers, and investors who wish to acquire immediate, comprehensive, and practical knowledge of derivatives.

Finally, it serves as a useful aid for students of related courses.