In 1993 conglomerate Metallgesellschaft AG lost investments in derivatives which were made by its branch department in the USA. Overall loss was initially evaluated in the sum over $1 billion – sufficient to deliver Metallgesellschaft, 14 in the sizes an industrial enterprise in Germany, on a bankruptcy side. But this first known accident on derivatives represented just florets.

After troubles with Metallgesellschaft accidents with the companies, trying to be established in the country of derivatives, fell down in abundance. Cargill has lost $100 million, playing with derivatives hypothecary, Procter Gamble, one of the American blue chips, has lost $157 million on hedging of currency derivatives, and losses Codelco Chile have constituted $200 million on futures for copper and precious metals.

Here it is possible to add Daiwa Bank of Japan, Sumitomo Corporation, Ashanti Goldfields. In 1994 Robert Citron, the head of exchequer of one of the most safe areas of USA, Orange County in California, has made bankrupt the richest county. Mr. Citron movable by a noble impulse to make the county even richer, has enclosed a public money in various brave exotic derivative instruments, including opposite transactions, for the purpose of reception of high returns for the Investment pool of a county which it operated. Unfortunately, when the markets have moved against its huge debt items, funds which were under its care, have instantly lost $1.5 billion during hearings in the senate of the State of California in 1995 Citron has declared: «I recognize forced with humility that I actually not so skilled treasurer as I considered myself to be».

In February, 1995 the proud and nice English Barings Investment Bank which just has noted 223-year-old anniversary has failed. Bank among which clients there was even queen Elizabeth, the bank, whose money have lifted great British Empire in a XIX-th century, has been destroyed as a result of autocratic bargains with derivative papers the price on which has gone not to that party in which it was supposed.

The dear conservative pillar of an English financial system has died as a result of powerful and on the substance of the uncontrollable forces which have been pulled out on open space thanks to young to trader Nicholas Leeson, the 27-year-old trader working on short-term gamble, has managed to lose almost instantly $1.3 billion before managing directors of head office in London could understand that has occurred.

Roguish trader Nick Leeson did the big rates on prospective movement of a Nikkei with use of simple options. It has delivered on them millions of dollars. Epidemic of crashes on derivatives continued the victorious procession on the world in the late nineties. The most remembered and accident with hedge fund Long Term Capital Management (LTCM) which was generated, by the way, by the well-known Russian debt crisis on August, 17th, 1998.

In case you decided to participate in forex trading should start from learning the basics of this market to make sure you do not experience problems with this industry.

There is another option – you can hire experienced traders to do this job for you – read more about forex investment here. Also make sure to search for the knowledge in a good forex book.

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