Legal basis of functioning and development of the derivatives market in Ukraine

Iryna PATERYLO

PATERYLO I. (2022), Legal basis of functioning and development of the derivatives market in Ukraine, Scientific Bulletin of Dnipropetrovsk State University of Internal Affairs, №4, 162-168

DOI: 10.31733/2078-3566-2022-4-162-168

 

ABSTRACT. A brief overview of the legal regulation of the functioning of the derivative securities (derivatives) market has been presented. The relevance of their application in the conditions of modern financial markets is substantiated. The role of derivative financial instruments in the processes of development and functioning of the financial system and the financial market is considered. The article outlines the four main types of derivative contracts: forwards, futures, options, and swaps. The prospects for the development of the Ukrainian derivatives market, which is impossible without the improvement of the regulatory and legal framework, the implementation of a consistent national policy regarding the financial market, are considered.

The author has concluded that in the case of correct application, derivatives can bring significant economic benefits. These tools help economic agents to improve the management of market and credit risks. They also promote financial innovation and market development, increasing the market’s resilience to shocks. The market of derivative financial instruments has turned from one-time transactions into an integral part of the international financial market. The reason for the active use of these tools in the world market is their ability to reduce the dependence of a wide range of users on market fluctuations. The stock market of financial derivatives can be considered as a mechanism for ensuring economic and financial stability, as well as carrying out the necessary transformational changes on the way to the global integration of the financial system of Ukraine.

Keywords: financial market, derivative securities, legal regulation, derivatives, forward, futures contracts, options, swaps, exchange transactions, financial instruments, issuers of securities.

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