ORCID
Tomasz Miziołek: 0000-0001-7844-9535
Keywords
exchange-traded funds, derivatives, investment strategy, risk hedging
Abstract
The main aims of the paper are to examine the use of derivatives by 13 exchange-traded funds primarily listed on the Warsaw Stock Exchange over 2010–2025, including their magnitude and functions, and to identify patterns in derivative use over the past three decades worldwide. The results reveal that derivative use was common among exchange-traded funds listed on the Warsaw Stock Exchange; however, it was limited to basic applications. Futures (standard, e-mini, and micro e-mini) were used to obtain leveraged or inverse market exposure or as a supplement to equity holdings, total return swaps were used for synthetic replication, and forwards were used for currency hedging. This study is the first analysis of derivative adoption by exchange-traded funds in an emerging market. In an international perspective, derivative use has evolved substantially over the past three decades, mainly due to the dynamic expansion of the exchange-traded fund market, but also as a result of legal changes facilitating the use of these instruments.
Acknowledgments
Funding
The research received no funds.
Declaration of Conflicting Interests
The authors declared no potential conflicts of interest with respect to the research, authorship, and publication of the article.
Declaration about the scope of AI utilization
The authors did not use an AI tool in the preparation of the article.
Recommended Citation
Miziołek, T. (2026). Employing Derivatives in Exchange-Traded Funds: International Perspective and Polish Evidence. Journal of Banking and Financial Economics, 2026(1), 69-114. https://doi.org/10.7172/2353-6845.jbfe.2026.1.7
First Page
69
Last Page
114
Page Count
19
Received Date
30.01.2026
Revised Date
21.06.2026
Accept Date
23.06.2026
Online Available Date
21.07.2026
DOI
10.7172/2353-6845.jbfe.2026.1.7
JEL Code
G11, G12, G13, G23
Publisher
University of Warsaw
