WASHINGTON -- Federal regulators are worried that the rapid growth of sophisticated derivative transactions may pose risks for globally linked financial markets, but they those risks are currently manageable.

Susan Phillips, a Federal Reserve Board governor, and Brandon Becker, deputy director of the Securities and Exchange Commission's division of market regulation, both say federal regulators fear that a disruption in the derivatives market or the failure of a firm involved in derivatives could disrupt the stock markets or hurt large broker-dealers or banks.

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