MORRISTOWN, N.J. -- A recent survey of corporate financial executives by the Financial Executives Institute found that most companies that use derivatives do so to control risk, rather than to speculate.
Of the 428 companies responding to the survey, 41% said they use derivatives.
The survey also found that only 2% of the respondents use derivatives for trading and to make a profit. An overwhelming majority, 74%, said they use derivatives primarily for financial management.
Nearly one-quarter of the respondents said they use derivatives for both financial management and trading.
However, more than a quarter of derivatives users - 28% - said their bankers do not adequately explain the risk.
