People and institutions might also search for arbitrage chances, as when the present purchasing cost of a property falls listed below the price defined in a futures agreement to offer the asset. Speculative trading in derivatives gained a good deal of notoriety in 1995 when Nick Leeson, a trader at Barings Bank, made poor and unauthorized financial investments in futures contracts.The true percentage of derivatives contracts used for hedging purposes is unidentified, however it seems relatively small. Also, derivatives contracts account for only 36% of the typical firms' total currency and rate of interest exposure. Nonetheless, we understand that many firms' derivatives activities have at least some speculative part for a variety of factors.