CDS market size hits $34.5 trillion, says Isda

The credit default swap (CDS) market has continued its rapid growth, rocketing to $34.5 trillion in notional outstanding by the end of 2006, according to the latest market survey by the International Swaps and Derivatives Association which was released yesterday at Isda's annual meeting in Boston. That figure is a 33% increase from June 30, 2006 when the market size was $26 trillion. The annual growth rate was 102% in 2006 compared with 103% in 2005.

Trading of interest rate derivatives grew steadily at 14% from about $250 trillion to $285.7 trillion in notional outstanding during the second half of 2006. For the year as a whole, it grew 34%, which was the same rate as 2005.

Notional outstanding of the equity derivatives market grew by 12% during the second half of 2006. The market size rose from $6.4 trillion on June 30, 2006 to $7.2 trillion on December 31, 2006. The annual growth rate fell from five percentage points from 34% in 2005 to 29

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