Table of Contents

INTRODUCING DERIVATIVES.

Options and Futures.

Swaps and Structured Notes.

Mortgage "Derivatives." Leverage.

DERIVATIVES IN ACTION.

Overview of Modern Derivatives Uses.

Hedging a Stock Portfolio.

Business Risk Management.

Investing Through Derivatives.

UNDERSTANDING AND MANAGING RISK.

Summary of Risk.

Derivative Disasters.

Derivative Regulation.

Controlling Risk.

FIDUCIARY RESPONSIBILITIES OF USING DERIVATIVES.

Your Fiduciary Duty.

Standard of Care in Delegation.

Legal Liability in Using Derivatives.

Looking Forward.

Glossary.

Index.

About the Author

BIDYUT SEN is a Managing Director of Morgan Stanley & Co., Inc.where he is the global head of Structured Asset Management and aformer co-head of the Worldwide Derivative Products Group. He hasbeen a leading figure in derivative products and structuredfinancing for more than a decade and is responsible for a number ofinnovations in that area.

GEORGE CRAWFORD is a lecturer at the Stanford Law School where heteaches derivatives and fiduciary investing to students andcorporate directors at the Directors' College. His practicalexperience as an investor, and formerly as General Counsel of apublic company, a White House staff member, and a Partner and theFirm Chairman of the Private Capital Section at Jones, Day, Reavis& Pogue, complement his academic perspective as a Stanfordteacher, Hoover Institution Research Fellow, Fiduciary FoundationDirector, and former Harvard Law Review President and Law Clerk toU.S. Supreme Court Justice Byron White.