Derivatives exchanges? ımpact on financial markets and derivatives markets in Turkey

The strict regulation of financial sector leads financial markets to produce new products under the name financial innovation. The latest outcome of financial innovation is derivatives which has reached high levels of transaction in the recent years.Although the history of derivatives goes back to ancient times, modern derivatives has gained importance in 1990s and further accelerated in 2000s.This paper focuses on two main issues. Firstly, it addresses the evolution of derivatives in the world and in Turkey, giving special importance of the derivatives market on the financial sector and on the monetary and fiscal policies. Secondly it analysis the Turkish Derivatives Exchange and its role on the evolution of derivatives.As a result, it is found that derivatives are useful fort the economies since they deepen capital and financial markets, provide elasticity in the use of monetary and fiscal policies. But, for them to be more beneficial, derivatives markets must be monitored as it is the case in financial markets and in terms of risk management accountability and transparency standards must be defined.