Individuals and institutions may likewise search for arbitrage opportunities, as when the present buying cost of a possession falls listed below the cost specified in a futures contract to sell the asset. Speculative trading in derivatives gained a terrific deal of prestige in 1995 when Nick Leeson, a trader at Barings Bank, made bad and unapproved financial investments in futures contracts.The real percentage of derivatives contracts utilized for hedging functions is unknown, but it seems relatively little. Likewise, derivatives contracts represent only 36% of the typical firms' overall currency and rate of interest exposure. Nevertheless, we understand that numerous companies' derivatives activities have at least some speculative part for a range of factors.