Investment banks create complex derivative contracts for their clients to hedge all kinds of risk.

Often the parties cannot easily agree on terms to close a derivative contract.

Changes to anti-avoidance rules on loan relationships and derivative contracts.

Rules regarding enforceability of derivative contracts have to be laid down.

But many other kinds of derivative contracts are tailored for specific parties.

The credit risk equivalent of the derivative contracts was estimated at $3.3 trillion.

Eventually the derivative contracts worth $2.1 billion lost significant value.

Industrial companies, large and small, use derivative contracts, for example in metal futures, to service their manufacturing needs.

But at times, companies have created more risk for themselves by entering the derivative contracts.

This was the first time that derivative contracts on global indices are available in India.