Modern derivatives increase exposure to volatility to profit from it.

Evidence

The derivative product that emerged in the second half of the twentieth century offers a fruitful terrain on which to explore the speculative mode of today’s political economy because it captures the development of a particularly complex and opaque type of speculation. In their most speculative use, modern-day derivatives are used to increase rather than limit exposure to future volatility, with the hope of profiting from underlying asset price movements. Volatility, in that sense, now becomes the means of ensuring all-important finance liquidity. To put it more blandly: if prices don’t move, speculators will induce price movement for gain. — Aris Komporozos-Athanasiou, Speculative Communities, 59

In their most speculative use, modern-day derivatives are used to increase rather than limit exposure to future volatility, with the hope of profiting from underlying asset price movements. Volatility, in that sense, now becomes the means of ensuring all-important finance liquidity. To put it more blandly: if prices don’t move, speculators will induce price movement for gain. It was this calamitous exposure, through the trading of collateralized debt obligations and credit default swaps in the 1990s and 2000s, that precipitated the collapse of financial institutions in 2007–8. — Aris Komporozos-Athanasiou, Speculative Communities, 59

Categorization

• XREF: ‘If prices don’t move, speculators induce price movement for gain’ is the engine of betting-on-volatility that the reader wants to trace into dating, politics, and self-presentation. — connects to: Tech platforms seed uncertainty and profit from it, like derivatives — Aris Komporozos-Athanasiou, Speculative Communities: Living with…, 297; Derivatives inverted from insurance into engines that increase volatility exposure. — Aris Komporozos-Athanasiou, Speculative Communities: Living with…, 91; The derivative is a single instrument fusing insurance motives with betting motives. — Aris Komporozos-Athanasiou, Speculative Communities: Living with…, 90 (+2 more)
• corroborated: 2 independent passages support this claim — Aris Komporozos-Athanasiou, Speculative Communities: Living With…, 59