Exchange chief defends use of derivatives

The head of the Chicago Mercantile Exchange has defended exchange-traded derivatives as being of 'overwhelming value' allowing market participants to spread and mitigate risk.

However, Leo Melamed, speaking at the FOW futures and derivatives conference in London in June, drew a distinction between exchange-traded derivatives ' with 'disclosure and transparency the hallmarks of their transaction and clearing mechanisms' ' and over-the-counter, exotic products where 'mark-to-modeling¦ offers oppor