Great expectations

New derivatives product launches appear all the time. Some literally change the course of the financial markets, while others fade away with little more than a whimper. Mark Pengelly looks at the products that were heralded as major developments, but have since been consigned to the derivatives trash heap

Twenty years of dynamism in the over-the-counter derivatives market have yielded some astonishing successes. Red-hot competition has fuelled continuous innovation, and created in its wake a phalanx of new derivatives products. Many of them have made an active and visible contribution to the explosive growth of the derivatives market. Credit default swaps (CDSs), for example, came from humble beginnings to constitute a market worth $34.5 trillion in 2006, according to the International Swaps and