Skip to main content
Article thumbnail
Location of Repository

From green fields to green felt tables and back: the origin of index-based derivatives

By Yuval Millo


The introduction of index-based derivatives is one of the most important developments in post-war financial markets; today these contracts are amongst the most commonly traded financial instruments. Yet, no sociological accounts based on empirical material have focused on the creation of index-based derivatives as a social and political institution. This paper offers index-based derivatives as a topic for sociological investigation. Focusing on the creation and regulatory approval of the first exchange-traded index-based futures in the early 1980s, the paper assesses empirical evidence collected through interviews with key figures who took part in the historical events, as well as extensive archival research. The paper makes two central claims. Firstly, that the nature of index-based financial markets is critically dependent on the nature of the qualification process it undergoes - a process through which the particular qualities are negotiated and attached to the products and in particular on the viability of the connections made between the financial contract and the assets on which it is based. Secondly, that qualification of products takes place within a network made up of heterogeneous agents, whose worldviews and motivations are frequently conflicting

Topics: K Law (General)
Publisher: Centre for Analysis of Risk and Regulation, London School of Economics and Political Science
Year: 2007
OAI identifier:
Provided by: LSE Research Online

Suggested articles


  1. (1986). (forthcoming) 'Safety in numbers: how exchanges and regulators shaped index-based derivatives'
  2. (2006). An engine, not a camera: how financial models shape markets. London, doi
  3. (1995). An introduction to derivatives.
  4. (1990). Card sharps, dream books and bucket shops: gambling in nineteenth-century America. doi
  5. (2005). Circuits within capitalism'. The Economic Sociology of
  6. (1995). Cognition in the Wild. doi
  7. (1974). Commodity exchange act.'
  8. (1976). Commodity futures trading act.' doi
  9. (1985). Commodity markets in their policy context.' Pp. 1-13 in How Commodity futures markets work, edited by
  10. (2002). Critical reflections on regulation', CARR Discussion Paper no. 4, London: CARR, LSE Board of Trade of City of Chicago v. SEC., 677 F.2d 1137 (7th Cir.
  11. (2001). Decentring regulation: understanding the role of regulation and self regulation in a ‘post-regulatory’ world’, Current Legal Problems, doi
  12. (1996). Derivative markets - theory, strategy, and Applications.
  13. (1996). Derivatives: A comprehensive resource for options, futures, interest rate swaps and mortgage securities. doi
  14. (1985). Economic action and social structure: the problem of embeddedness.' doi
  15. (2005). Economic markets as calculative collective devices.' doi
  16. (1988). Evolution of the international monetary market.'
  17. (1996). Financial exclusion and the shifting boundaries of the financial system.’ Environment and Planning A
  18. (1986). Financial futures.
  19. (1978). Genealogy and genetics of 'contract of sale of a commodity for future delivery' in the commodity exchange act.'
  20. (2002). Introduction: locating cities on global circuits' Saskia Sassen.' in Global networks, linked cities, edited by Saskia Sassen. doi
  21. (1975). Letter by Roderick Hills, chairman, SEC to the CFTC concerning the approval given to CBOT to trade futures on GNMA certificates.
  22. (1986). Monopoly, manipulation, and the regulation of futures markets.' doi
  23. (1991). Nature's Metropolis - Chicago and the great west. doi
  24. (2003). Negotiating a Market, Performing Theory: The Historical Sociology of a Financial Derivatives Exchange." doi
  25. (1982). Opinion in Board of Trade of City of Chicago v.
  26. (1986). Program trading nightmare for technical analysts.'
  27. (1992). Responsive regulation: transcending the deregulation debate. doi
  28. (1996). Scientific knowledge: a sociological analysis. doi
  29. (2006). Semi-annual OTC derivatives statistics at end-June
  30. (1983). Social life as bootstrapped induction.' doi
  31. (2004). The big, bad wolf and the rational market: portfolio insurance, the doi
  32. (1986). The economics of future markets.
  33. (2002). The economy of qualities.' doi
  34. (1997). The financial futures primer.
  35. (1988). The grain traders: the story of the Chicago board of trade. East Lansing, doi
  36. (1987). The history of commodity futures trading and its regulation.
  37. (1993). The merc: the emergence of a global financial powerhouse.
  38. (1997). The options primer. doi
  39. (1989). The social meaning of money: 'special monies'.' doi
  40. (1986). The society of mind. doi
  41. (2004). Tools of the trade: the socio-technology of arbitrage in a Wall Street trading room.' doi
  42. (1986). Traders get taste of futures shock.' in Chicago Sun-Times.
  43. (1984). Wayward capitalists: target of the securities and exchange commission. New Haven, doi

To submit an update or takedown request for this paper, please submit an Update/Correction/Removal Request.