Derivatives: Educate, don't legislate

It’s hard to know what Alan Kohler’s dislikes most about the finance world. I thought it was high frequency trading, but his most recent article Throw the Gaming Act at derivatives bookies suggests that derivatives are fast catching up. Alan’s basic argument is that derivatives have been used by a whole bunch of less scrupulous (or less knowledgable, depending on your view) finance types to convince unsophisticated investors to make bets they didn’t understand. On this, I wholeheartedly agree. Where misleading sales techniques were used to dupe investors, the institutions and individuals involved should suffer the consequences. Similarly, negligent investment...

It’s hard to know what Alan Kohler’s dislikes most about the finance world. I thought it was high frequency trading, but his most recent article Throw the Gaming Act at derivatives bookies suggests that derivatives are fast catching up.

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