Risk Takers

Risk Takers: Uses and Abuses of Financial Derivatives bridges the gap between theory and practice, making the often mysterious world of derivative finance both accessible and engaging. Through clear explanations and real-world stories, John Marthinsen reveals how derivatives can be wielded to create or destroy value. Written in an approachable, non-technical style, the book vividly brings financial events to life, offering valuable insights into their causes, consequences, and lasting implications for markets and regulators.

This updated edition features in-depth analyses of the Archegos Capital Management collapse, driven by reckless use of total return swaps, and the Greensill Capital debacle, rooted in the misuse of supply chain finance through reverse and future factoring, and their pivotal roles in the downfall of Credit Suisse, once Switzerland’s second-largest bank. These and other real-life case studies enable even beginners to grasp the causes and effects of major derivative failures, while financial experts will find the analyses both rigorous and thought-provoking.

Risk Takers stands out for its clarity, depth, and breadth, illuminating how derivative failures connect to broader financial and economic issues. It offers timely lessons on how unchecked financial innovation can escalate into systemic crises when risk management fails.

John E. Marthinsen is Professor of Economics and International Business at Babson College in Babson Park, MA, where he holds The Distinguished Chair in Swiss Economics. He has extensive consulting and teaching experience, working for both domestic and international companies and universities, as well as the U.S. government. John has served on international company boards, the United Nations Association’s Economic Policy Council, and lectured at the Universities of Bern and Basel in Switzerland, and the University of Nurnberg in Germany. The author of many books and articles and the recipient of multiple teaching awards, his current research focuses on international macroeconomics and risk management, with a particular focus on Swiss financial markets and cryptocurrencies.