Prelims

Half Title

Financial Derivatives

Title Page

Financial Deriv0ativesrd: A Blessing or a Curse?

By

Simon Grima

University of Malta, Malta

and

Eleftherios I. Thalassinos

University of Piraeus, Greece

Edited by

Rebecca Dalli Gonzi

University of Malta, Malta

and

Ioannis E. Thalassinos

Gulf University for Science and Technology, Kuwait

United Kingdom – North America – Japan – India – Malaysia – China

Copyright Page

Emerald Publishing Limited

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First edition 2020

Copyright © 2020 Emerald Publishing Limited

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British Library Cataloguing in Publication Data

A catalogue record for this book is available from the British Library

ISBN: 978-1-78973-246-7 (Print)

ISBN: 978-1-78973-245-0 (Online)

ISBN: 978-1-78973-245-0 (Epub)

Contents

About the Authors

Dr Simon Grima, PhD (Melit.), MSc (Lond), MSc (BCU), BCom (Hons) (Melit.), FFA, FAIA (Acad), is the Head of the Insurance Department, in charge of the undergrad and postgrad degrees in Insurance and Risk Management and a Senior Lecturer at the University of Malta. He served as the President of the Malta Association of Risk Management and the Current President of the Malta Association of Compliance Officers. Moreover, he is among the first Certified Risk Management Professional (The Federation of European Risk Management Associations, [FERMA]), is the chairman of the Scientific Education Committee of Public Risk Management Organisation (PRIMO) and served as a member of the curriculum development team of The Professional Risk Managers’ International Association (PRMIA).

His research focus and consultancy is on internal controls (i.e. risk management, internal audit and compliance) and has over 25 years of experience varied between Financial Services and with public entities in internal controls, investments and information technology. He acts as an Independent Director for Financial Services Firms sits on Risk, Compliance, Procurement, Investment and Audit Committees and carries out duties as a Compliance Officer, Internal Auditor and Risk Manager.

He has been a member of the scientific committees and chair of international conferences and is a reviewer and chief editor of some journals, books and book series. Moreover, he has been awarded Outstanding Reviewer for Journal of Financial Regulation and Compliance in the 2017 Emerald Literati Awards.

Eleftherios I. Thalassinos holds a PhD in Quantitative Methods and International Finance (UIC, Chicago, 1983), three Doctor Honorius Causa (DHC) degrees in Business and Economics (Danube’s University of Galati, 2013; University of Craiova, 2015; and Rostov University of Economics, 2018), an MBA in International Business (De-Paul University of Chicago, 1979) and a BA in Economics (University of Athens, 1976).

He holds a Jean Monnet Chair (1997) experienced in European Economic Integration and International Finance. He is the Editor-in-Chief of the European Research Studies Journal since 1998, a 22-year-old international publication; the International Journal of Economics and Business Administration since 2013, a 7-year-old international publication; and the Founder and Chair of the International Conference on Applied Business and Economics, an 18-year-old international conference.

He participates as an editorial board member in various journals; he is an external advisor in European projects and an international consultant in public and private entities. His professional experience includes quantitative analysis, technical and financial analysis, banking, business consulting, project evaluations, international business, international finance and shipping.

He has an extensive record of lecturing in several universities around the world (Europe, America and Asia), participating in international conferences as a key note speaker, coaching PhD students, cooperating in projects and scientific initiatives through a worldwide network channel, the International Strategic Management Association a non-profit scientific association, where he holds the position of the Chair of the Board of Directors.

He has received three DHC degrees as a recognition to his efforts to promote research and cooperation in former Eastern European countries. He has also received a Honorius Medal of high recognition from the Rostov State University of Economics in 2016 and from the University of National and World Economy in 2017. Among others he is organising specific workshops promoting scientific research and writing tips to young researchers and academics.

He has a long track of publications in many journals, collective volumes and chapter books. Among them a publication as a chapter book in the World Scientific Handbook in Financial Economics Series, Vol. 5, dedicated to the memory of Late Milton Miller, Nobel Prize winner in Economics in 1990.

He is the editor of two collective volumes in Contemporary Studies in Economic and Financial Analysis Series, Vol. 100 and Vol. 101, published by Emerald and in Business, Technology and Finance Series (2019) published by NOVA Science Publishers.

Parallel to his academic career he has performed as Banking Director for 12 years, Ministerial Advisor for 6 years, Public Servant for 4 years and independent consultant for many years.

About the Editors

Dr Rebecca Dalli Gonza, PhD, is a Lecturer at the Department for Construction and Property Management. She is a registered and certified Civil Engineer by the Chamber of Architects, Malta, and founded a business advisory service to assist businesses in taking strategic decisions in 2013.

Dr Ioannis E. Thalassinos, PhD (University of Piraeus, Greece), MSc in Finance (London Business School, UK), MBA and MSc in Economics (University of Illinois, Chicago, USA) and BA (Athens University of Economics and Business, Greece), is an Adjunct Professor at Gulf University for Science and Technology in Kuwait. He has over 15 years of international finance experience including investment banking, corporate banking, strategic advisory and corporate development. He works as a Global Investment Manager for the MA Kharafi & Sons Group in Kuwait. He has previously worked for NM Rothschild & Sons and Barclays Capital in London and Unicredit Corporate & Investment Banking and Deloitte Management Consulting in Athens. His research experience includes quantitative analysis, technical and financial analysis, banking, business consulting, project evaluations, international business, international finance and shipping.

Acknowledgements

This work is largely based on an unpublished PhD thesis by Dr Simon Grima, finished in 2011, ‘A study of Uses and Misuses of Derivatives’, at the University of Malta, Banking and Finance Department, and some of his papers which are referenced in the bibliography and text. Here, the authors introduce and discuss financial derivatives, their uses and the debates surrounding their use by digging into literature, theory and famous case studies.

We wish to express our gratitude to Dr Rebecca Dalli Gonzi and Dr Ioannis E. Thalassinos for carrying out the editing of this book.

Moreover, we would like to show our warmest gratitude to our family especially our wives Leanne and Sortiria for their continual support, patience, encouragement and love and to God for giving us the strength and encouragement needed to carry out this task.

Finally, we would like to thank Charlotte Maiorana for her interest and support and Charlotte Wilson for their wonderful step-by-step continuous guidance through the production process. You have made working with Emerald most rewarding.