Individuals and institutions might likewise look for arbitrage opportunities, as when the present purchasing rate of a possession falls below the cost specified in a futures agreement to offer the asset. Speculative trading in derivatives got a good deal of prestige in 1995 when Nick Leeson, a trader at Barings Bank, made bad and unauthorized financial investments in futures contracts.The real percentage of derivatives contracts used for hedging purposes is unknown, however it seems reasonably small. Also, derivatives contracts account for just 36% of the typical companies' overall currency and rates of interest direct exposure. Nevertheless, we understand that many firms' derivatives activities have at least some speculative element for a range of factors.