Article at a glance:

Futures trading in emerging markets

World futures markets, spurred by the rise of electronic trading and interexchange competition, are now in bloom. Those of developing economies such as China and India, which have the greatest need for them, are experiencing the fastest growth, but these are also among the countries most likely to hamstring them with shortsighted regulatory policies.

The take-away

Properly functioning futures markets strengthen a country’s economy. Excessive capital requirements, restrictions on foreign participation and capital movement, and limits on the types of products traded all conspire to hamper them.