Apart from large daily volumes, we have other products such as equity derivatives, security lending and borrowing, algorithm trading, etc. 13. The main focus of concern in equity market is investor protection and integrity of trading. Equity derivatives, like all derivatives, can be used either to hedge an existing position or express a view on the equity prices or indices.
Derivatives being leveraged structures have the potential to amplify the loss or gain in an asset. For the same reason, it can also contribute to the volatility. 14. From a systemic financial stability perspective, the concern about the equity market stems from the source of financing equity positions.