Who are the participants in the derivatives market?

The derivatives market relies on four primary types of market participants, each serving a distinct financial function: • Hedgers: Investors or businesses that use derivatives to protect themselves against potential financial risk or adverse price movements in the underlying asset. • Speculators: Traders who take on risk by betting on future price movements in pursuit of profit. • Arbitrageurs: Traders who exploit temporary price discrepancies across different markets or related contracts to make risk-free profits. • Margin Traders: Participants who trade derivatives using leveraged funds/margins provided by brokers to increase their exposure and potential returns.