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A comment on For the Love of Money. Parent comment

Re:For the Love of Money by cperciva on Sunday January 19, 2014 @03:40PM (#7085901)
Is there some other way in which derivatives serve an ostensibly positive function in society?

I think the largest benefit is for organizations like pension funds which are required to minimize risk. Being able to hedge against specific types of risk (e.g., via a "longevity swap") allows pension funds to allocate their limited "risk budget" in ways which yield higher returns (thereby allowing them to pay out higher pension values).

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Re:For the Love of Money by ItendToDisagree on Sunday January 19, 2014 @03:48PM (#7085922)
This is a good point and can be true. As long as the market isn't manipulated this sort of thing can happen. Or even if the manipulation is minimal and there isn't a crash caused by hidden information.
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