Managed Futures Today Magazine

In recent years, many investors found out the hard way they have very little recourse to recover funds in the event of a financial firm’s bankruptcy. Although the Bernie Madoff “hedge fund” was by far the highest profile case, there were numerous less publicized bankruptcies and defaults at other firms and investments (including legitimate ones), in which investors found recouping remaining funds difficult or impossible.

Because the term “derivatives” has been tossed around so casually in the media in recent years, futures (and options on futures) have often gotten lumped together in the public mind with the unstructured and unregulated over-the-counter instruments, such as credit default swaps, that were so enmeshed in the 2008 financial market crisis.