New reports sceptical on derivatives

Two new reports have given participants in the credit derivatives market pause for thought. A report from Fitch Ratings argues that, while volumes and new participants continue to rise, levels of liquidity in the market are yet to stabilise. And a report from consultancy firm McKinsey & Co warns that some players are pushing too aggressively into the credit derivatives market.

Written by consultants Arno Gerken and Hugh Karseras, the McKinsey report argues that many of the market’s newest players