Impact of financial derivatives on systemic risk

Abstract

Financial derivatives are a fast-growing area of financial instruments. They take a very important place among other financial products, because not just their value depends on underlying assets, but they are also used in many other financial products. Scientists observe, that financial derivatives are beneficial to country’s economy but at the same time pose many risks, which increase country’s systemic risk. It can be noticed, that financial derivatives were highly criticized after 2008 global financial crises, and it became very important to assess their impact on country’s systemic risk. However, no scientific analysis has been performed so far to asses and justify theoretical impact of financial derivatives on the country’s systemic risk. This research analyses scientific literature and theoretical insights are provided regarding the impact of financial derivatives on country’s systemic risk.