People and institutions may likewise try to find arbitrage chances, as when the current purchasing rate of an asset falls listed below the cost defined in a futures contract to sell the possession. Speculative trading in derivatives got a good deal of prestige in 1995 when Nick Leeson, a trader at Barings Bank, made poor and unapproved investments in futures contracts.The true percentage of derivatives agreements used for hedging functions is unidentified, but it seems reasonably small. Also, derivatives contracts account for just 36% of the mean companies' total currency and rate of interest direct exposure. However, we understand that lots of firms' derivatives activities have at least some speculative part for a variety of factors.