If you stay in markets long enough, you begin to notice a strange asymmetry. The forces that shape the financial world most deeply on the longer arc of time rarely appear on the front page. They operate quietly, accumulating influence over decades, until one day, suddenly, it seems they appear as the new center of gravity. Commentators then treat the shift as something that happened overnight.

The rise of private markets gets this treatment today. But another shift has occurred even more quietly, and with far wider implications: the slow, steady derivatization of investment products.

This is a story about that shift. It is also, inevitably, a story about me, and about what it feels like to live through these transformations not as an observer, but as someone who has been both shaped by them and, in small ways, contributing to them.

Derivatives: A Hidden Giant in Plain Sight

Most readers will be surprised to learn that, as this decade began, the global derivatives market stood at roughly $628 trillion in notional value.ⁱ That was about six times the world's GDP,ⁱⁱ and roughly three times the combined value of global stocks and bondsⁱⁱⁱ at the time. Numbers that large don’t grow from hype. They grow from utility; deep, structural usefulness recognized by the institutions that shape global finance. Derivatives are not merely a niche curiosity of financial markets. They shape the interest rate on a homeowner’s mortgage, the price paid at the gas pump, the cost of food on grocery shelves, and the financing terms embedded in credit cards and auto loans. Even investors who have never seen an options chain live inside a world quietly priced and stabilized by derivatives.

Yet the average investor has never owned a derivative. Historically, derivatives have been the domain of institutions, and specialized desks. Retail access was limited, not because derivatives lacked value, but because the market lacked a vehicle capable of delivering that value consistently and transparently.

About fifteen years ago, a group of entrepreneurial firms set out to bridge this gap. Vest was one of them. After building and running Vest for more than a decade, I’ve come to appreciate how non-linear the path to such an evolution really is.

Derivative-based products have exploded from essentially zero to more than $250 billion. Buffer ETFs, RILAs, defined income strategies, structured UITs, autocallable funds, QIS strategies, managed accounts with overlays – the list grows each month. I believe the pace is accelerating to a point where we may soon trade “billions” for “trillions” just to economize on the digits. ^{iv, v}

The journey here was not inevitable. It was shaped by a specific combination of academic breakthroughs, market crises, regulatory evolution, cultural shifts, and entrepreneurial persistence. It was shaped by people who were, like me, trying to solve problems that first revealed themselves decades earlier.

Origins: The Mathematics That Made It Possible

The story of modern derivatives is more likely to be found in mathematics textbooks than on trading floors. While sophisticated derivatives such as options have been part of recorded history for centuries, the biggest obstacle to wider adoption of derivatives was figuring out the math on how to value them. The first options pricing model was offered by Loise Bachelier, a French mathematician in 1900. ^vi

While there were theoretical improvements along the way, a real breakthrough did not come until the early 1970s, with Fisher Black and Myron Scholes, who devised a rigorous yet flexible method for pricing options, which is now familiar to virtually all options traders and financial scholars. This has been described as the “the most successful model in applied economics.” ^vii The development of these pricing tools heralded a worldwide adoption in wider usage of options.

The first day of trading for the Chicago Board Options Exchange was April 26, 1973, when 911 option contracts traded on the exchange. Over the next several years, options were traded on new exchanges all over the world. Adoption spanned the UK, Germany, Hong Kong and Tokyo. In 1988, exchanges were granted authorization to trade options in France, which laid the foundations of what would be the beginnings of democratization of the derivatives market. ^viii

1980-2000: Structured Notes, The First Attempt at Democratization

France, not New York or London, became the birthplace of the first major attempt to bring derivatives to everyday investors. Most notably, Société Générale plunged into the esoteric realm of derivatives in 1984. Two notable figures who led this charge at Societe Generale were Antoine Paille, who originated Société Générale's equity derivatives effort and Jean-Pierre Mustier, who would later go on to become the chief executive of Société Générale's corporate and investment banking business. “Options seemed to unite math, statistics and computers,'' Paille recalls. “I felt this was an area that would transform the banking environment.” ^ix

Mustier, a former computer salesman with IBM turned options trader, joined in 1987 as one of the three staff in equity derivatives working in a dingy basement in central Paris. ^x The group would go on to employ more than 3500 staff and contribute as much as 50% of the investment bank's profits decades later, thanks to a unique invention that would bring wider access to derivatives: a structured note.

A structured note is a debt obligation that also contains an embedded derivative component that adjusts the security's risk-return profile. The idea was both simple and radical: take something complex (a mix of options), de-emphasize the complexity, and offer the investor a clean, intuitive promise, such as: “protect the first 10% of losses;” “provide enhanced income;” or “give me upside participation with a defined floor.” This was the first real attempt to democratize derivatives, even if no one used that phrase at the time.

Just as an insurance policy protects against an accident, options let investors hedge against an unexpected rise or fall of a security or index, such as the plunge in U.S. technology shares that sent stock markets sliding in 2000. Demand accelerated massively when the bubble burst in 2000, and investors became a lot more skeptical about the overall returns of the stock market. As investors ranging from pension and hedge funds to wealthy individuals looked for ways to safeguard their investments, the structured notes market stood at hundreds of billions worldwide and was booming in 2005. From the success in European markets, structured notes found their way to the U.S.^xi In 2005, the Wall Street Journal reported approximately $49 billion of structured notes sales in the U.S., only to be eclipsed in 2007 with $107 billion in sales.

Encouraged by the success of French banks such as Société Générale, other European banks decided equity derivatives were an area they wanted to focus on and took on a lot of people with strong skills. To engineer options-based contracts, leading investment banks hired employees schooled in everything from partial differential equations to probability concepts like stochastic calculus and Brownian motion. As a freshly minted postgraduate in operations research, I was one such employee when I joined the equity derivative desk of a European bank in London in 2004. The timing could hardly have been better; I had a front row seat to this explosion in the market for structured notes. I started working at the bank as a quantitative analyst dedicated to using mathematical models that modelled risks in structured notes issued by the bank and put an offer price on their sale to the bank’s customers. As European banks sought to bring these derivatives-based securities to U.S., I was moved to the New York to help the bank set up its American structured notes business.

I fell in love with derivatives and the investment products they helped to create. Derivatives are one of the most fungible tools in the investment product developer’s tool kit. In trained hands they are like clay, allowing creative product developers to shape investment products for a wide range of use cases. Paul Graham famously compared hackers and painters with software engineers in his book Hackers & Painters, saying that they are both makers. “Along with composers, architects, and writers, what hackers and painters are trying to do is make good things. They are not doing research per se, though if in the course of trying to make good things they discover some new technique, so much the better.”^xii The same could be said about financial engineers, a term often used to describe the kind of work that analysts like I did – sitting at the intersection of trading, risk management, and client servicing, and building products that meet investing clients’ needs. It was a beautiful thing to learn about a client’s investment dilemma, then undertake a creative and analytical process seeking to produce a best-match solution. I reveled in my job.

2000’s: Mis-aligned incentives?

However, over the years, as the market for structured notes expanded, there were troubling signs. The early structured notes were simple. Eventually simplicity gave way to complexity. Banks pushed into increasingly exotic notes like multi-asset payoffs, path-dependent structures, and barrier variations. Products that were mathematically elegant but often inscrutable to investors.

Regulators took notice. The SEC warned about the lack of liquidity, the absence of secondary markets, and the opaque fees bundled into notes. ^{xiii, xiv, xv} Investors had no way out unless the issuing bank voluntarily bid for their notes. Many banks explicitly stated they had no intention of doing so. The deepest vulnerability was credit risk. Structured notes were unsecured promises. Investors traded away the safety of owning a portfolio of their own assets for the convenience of a clean payoff diagram where the bank made a contractual promise, but the client had no underlying holdings. Few investors fully understood this trade.

In October 2008, the music stopped. The subprime credit crisis spread to be a banking crisis. One of the biggest issuers of structured notes, Lehman Brothers, declared bankruptcy. Leading up to the bankruptcy, investors and financial advisors on behalf of their investing clients desperately knocked on the bank’s doors to buy back their notes. However, desperate for funding, Lehman did not offer any bid. Instead, leading up to its demise, Lehman Brothers used the structured note market to raise much needed financing from unsuspecting investors. ^xvi

When Lehman Brothers collapsed, investors learned overnight what "unsecured" meant. Notes marketed as “principal protected” lost most of their value. In some cases, investors lost nearly everything. And many of those investors were retirees who genuinely believed they had bought safety.
I remember those days vividly. The calls. The disbelief. The realization that a beautiful payoff engineered with precision could be undone entirely by the solvency of a single issuer.

The takeaway for me was clear: The structured note solved the right problem, but with the wrong wrapper. It was not derivatives that had failed. It was the delivery mechanism. That realization stayed with me long after I left the bank.

2010’s: A New Beginning, Moving from Structured Notes to Structured Funds

By 2010, Wall Street was a difficult place to work. The cultural backlash was sharp, and morale across trading desks was low. I left banking and joined an asset manager. There I dedicated myself to developing new investment products. Somewhat similarly to what I did at the banks, but now delivering them to investors in new delivery vehicles: mutual funds and exchange-traded funds.

Mutual Funds were developed in the 1920s and over the intervening century; the laws that governed these investment companies had evolved. High governance standards and best practices were adopted that made funds investor-friendly, and with trillions of dollars in investments, the leading vehicle of choice for U.S. investors. Enacted after the abuses of the 1920s and 30s, the Investment Company Act of 1940 greatly increased financial and administrative transparency for all investment companies, requiring SEC registration, disclosure of finances and investing policies, prohibition of changing certain investment policies without shareholder approval, and a minimum number of independent board members.

Investment companies are, in many ways, the opposite of structured notes. They are backed by investment assets, unlike structured notes which rely on the issuers’ promise. This makes the fund more resilient to the Lehman-like issuer default. Mutual funds and most ETFs are open-ended investment companies and are required by law to hold assets that provide a certain amount of liquidity to help ensure that investors who want to exit their investment can do so each day at an independent price. This feature of daily liquidity is unlike structured notes where, as the New York Times reported “Once you invest your money, you are essentially locked in for the duration of the contract” ^xvii. Investment companies are governed by a board of directors who seek to actively safeguard the fund shareholders’ interest against conflicts of interest, such as conflicts posed by banks when they issue structured notes to raise funds for their operations. Investment companies are required to disclose their holdings, fees and expenses in disclosure documents and regular reports. These requirements provide substantial transparency unlike structured notes, which, as the SEC points out “can have hidden or imputed costs, which in some cases may be relatively high.” ^xviii

While I learned about the positive attributes of investment companies and worked on developing new exchange traded funds at the asset management company, I continued to track what was happening in the world of structured notes.

At that point, the market for structured notes had fallen significantly. From its peak in 2007 when $107 billion of structured notes were issued, the new issuance market in 2012 stood at $39 billion. ^xix One of the biggest distributors of Lehman Brothers structured notes was the wealth management arm of a major European bank. As Lehman Brothers had increased its issuance of structured notes in 2007 and 2008, financial advisors at the wealth management bank had placed several of these notes with their clients. The bank sold to its clients about $1 billion worth of notes issued by the now-bankrupt Lehman Brothers Holdings^xx. Several of these structured notes were labelled “principal protected” notes. The bank would go on to pay $120 million in settlement over Lehman Brothers issued notes. ^xxi Structured notes sales continued to suffer.

While many investors recognized the utility that derivatives embedded in structured notes provided, they were repulsed by the wrapper they came in. One seasoned institutional investor of structured notes for his private banking clients declared an open challenge for the industry to solve the “credit-risk problem.” John Rekenthaler at Morningstar, an incisive commentator on the industry said: “For structured notes to become a meaningful investment segment in the U.S., they need a jailbreak. They need to be manufactured and distributed by parties other than banks and for their information and trading to be centralized.” ^xxii

While working on the buy-side, I had one of the best fortunes of my life. I befriended a colleague who sat next to me in the office, Jeff Chang. We talked markets endlessly and eventually found ourselves circling the same idea: the structured note, rebuilt from first principles, could be better—safer, cleaner, more transparent—if housed inside a registered fund. But we concluded that no existing asset manager was going to build this product. Which meant only one thing: we would have to start a new firm.

This was the mid-2010s. America was in love with startups. A new generation of founders challenged incumbents across industries. Silicon Valley had become a cultural phenomenon. Shows like Silicon Valley and movies like The Social Network gave entrepreneurship a narrative energy it had not had before. This mattered. It created cultural permission to attempt something ambitious and unproven.

The mid-2010s also saw the widespread adoption of a new investment technology: exchange-traded funds. The investment world was reorganizing itself around ETFs. What began as a small indexing innovation in the 1990s had, by the mid-2010s, become the default interface for investment ideas. Advisors were restructuring their practices around them. Asset managers were racing to launch them. Investors loved their simplicity and transparency. If software was eating the world, ETFs were eating the investment world. This second revolution turned out to be as important as the first. As I immersed myself in the world of funds, I could not shake the thought: Why couldn’t derivatives live inside this structure?

If we could package derivative payoffs into a fund, like a UIT, mutual fund, or ETF, we could retain the utility of structured notes without inheriting their systemic flaws.

As Jeff and I founded Vest, our core insight was simple. Banks hedged their structured notes using listed options. So why not cut out the bank? If we placed the same combination of options inside a fund, investors could hold shares backed by real assets instead of unsecured promises. The payoff structure would be the same, but we surmised that the risk profile would be dramatically better. No bank credit risk. Daily liquidity. We were convinced that these products would fit cleanly into the mainstream plumbing of wealth management.

This idea depended on a little-known tool: FLEX Options, which allowed the customization of payoff terms similar to structured notes while retaining the relative safety of exchange trading and central clearing. Launched in 1993, FLEX Options are quite like standardized listed options in that they trade on an exchange and are centrally cleared by the Options Clearing Corporation (OCC). However, their novelty is that they are customizable on key parameters like over-the-counter (OTC) options but with the convenience and a level of guarantee by the OCC of exchange-traded options. FLEX Options allowed us to replicate the attractive precision of structured notes.

With these insights, we went to work. I wrote out the details of how a buffer Unit Investment Trust (UIT) would work and filed what became the first patent in this space. ^xxiii Shortly after, we submitted Vest’s first registration statement with the SEC – the first ever to conceive of using FLEX Options in a registered fund to deliver a target outcome. ^xxiv At the time, we did not know we were planting the seeds of what would become a multi-billion-dollar category of new types of investment products. We were off to the races... or so we thought.

The Slow Build: Infrastructure, Other Pioneers, and Rule 18f-4

Balaji Srinivasan frequently describes a cultural and philosophical split between Silicon Valley, also known as “the West Coast,” with Wall Street and DC, or “the East Coast.” ^xxv In his telling, the West Coast embodies a build-first, engineering-driven ethos focused on innovation, decentralization, permissionless experimentation, and the creation of new systems, whether in software, biotech, or crypto. By contrast, the East Coast represents institutions of finance, government, and legacy power, where success is often tied to managing, regulating, or optimizing existing systems rather than creating entirely new ones. This difference produces tension: Silicon Valley tends to see Wall Street as extractive and over-financialized, while Wall Street often views tech as naïve, idealistic, or dismissive of risk and regulation. Other commentators echo versions of this divide: Peter Thiel frames it as “builders vs. bankers,” Marc Andreessen as “atoms vs. bits” institutional inertia, ^xxvi and observers like Ben Thompson describe the contrast between decentralized, iterative innovation and centralized, compliance-heavy structures. Together, these views paint a picture of two elite ecosystems with clashing incentives and worldviews: one oriented toward inventing the future, the other toward governing or arbitraging the present.

This cultural framing, while compelling, can also be misleading. The perceived cultural divide between Silicon Valley and Wall Street may be less about fundamentally different worldviews and more about the simple fact that the two ecosystems operate under dramatically different regulatory conditions. Technology is a relatively new industry where regulation has historically lagged behind innovation, allowing companies to experiment freely, scale rapidly, and adopt a “move fast” ethos that appears iconoclastic or rebellious. Financial services, by contrast, is one of the most heavily regulated sectors in the economy, shaped by centuries of legislation born from crises, systemic risk concerns, and the need for consumer protection. What looks like opposing philosophies—tech’s idealism versus Wall Street’s conservatism—can be understood instead as rational responses to their environments: tech innovates because it can, while finance institutionalizes because it must. Once you account for this difference in regulatory maturity, the “ethos gap” becomes less a clash of identities and more a predictable outcome of how freedom versus constraint shapes incentives, risk tolerance, and culture within each domain.

Jeff and I felt this firsthand. Inspired by the Silicon Valley lore, we went to Y Combinator and were ready to “move fast, break a few things.” However, we could not move fast. The examiners from the Securities and Exchange Commission who were reviewing our petition to bring this new product to market felt uneasy about the all-derivatives portfolio in investment products. Our first registration attempt triggered not only delays but a de facto moratorium on derivative-heavy UITs. It would take multiple years for the regulatory review process to start moving again with any discernible speed. However, in hindsight, these years proved to be instrumental in the development of other infrastructure that would be foundational for the scaling of derivative products to come.

While waiting for regulatory clarity, Vest did not sit still. We worked with index providers, derivatives exchanges, and liquidity providers to develop the first buffer indexes and improve trading infrastructure for FLEX options – building the plumbing the category would eventually need.

We were not alone for long. Other firms saw the opportunity: Exceed Investment, AAM, m+ Funds. Collectively, we pushed the ball forward. Later, when Guggenheim filed for buffer UITs and Innovator filed for buffer ETFs, a fresh spotlight shone onto the new category.

Early on, with UITs in regulatory limbo and the market infrastructure not yet ready for ETFs, we pivoted. In 2016, Vest launched the first-ever FLEX options-based buffer fund, which today holds the longest track record in the category. Exceed Investments and others followed shortly after. Slowly at first, and then quickly after, assets started trickling in. Which in turn led to more investments by companies to continuously upgrade the infrastructure. Between 2014 and 2019, while early entrants like Vest built products and filed designs, the supporting architecture quietly changed:

• Cboe and other exchanges improved FLEX functionality, adding features essential for large-scale fund operations.
• Liquidity providers built the ability to warehouse and hedge target-outcome exposures.
• Index providers built outcome-based benchmarks that brought legitimacy and transparency.
• Other innovators like Exceed, AAM, m+ Funds, Innovator, and so forth pushed the space forward, creating competitive energy.

Then, in 2020, the SEC delivered the missing piece. It released Rule 18f-4, which created a comprehensive regulatory framework which derivatives use inside 1940 Act funds. ^xxvii For pioneers, it was a watershed moment. Ambiguity became clarity. Review processes accelerated. Innovation no longer lived in regulatory limbo. The groundwork was complete. Just in time for what would come next.

The COVID Catalyst: Stress-Testing an Entire Decade of Work

When the COVID-19 crisis hit in early 2020, years of slow, patient infrastructure building were suddenly tested under real stress. Markets collapsed at a historic speed. Traditional diversification failed. Equities fell. Bonds fell. Correlations that were supposed to be more independent moved closer to one. But we believed that derivative-based strategies—particularly buffer strategies—were built for exactly this kind of environment.

Unlike structured notes, which depend on the solvency of an issuer, the new generation of products owned exchange-traded options directly inside registered funds. Their structures did not crack. Their liquidity held. The engineering did exactly what it was designed to do. ^xxviii

At Vest, the first twelve weeks of 2020 brought more than $1 billion in inflows into target-outcome strategies that we managed. Investors who had never used derivatives directly experienced, often for the first time, what derivatives could do: reshape risk intentionally rather than passively enduring market outcomes. “Buffer” became a widely recognizable word in investing. FLEX options, invented in 1993, came out of its obscurity and became mainstream.

An entire network of brokerage firms, exchanges, and market makers trading FLEX options was put to the test, and it held up. ^xxix The investment worked as designed, with liquidity that supported large transactions at competitive prices and no risk of bank credit default. These new investors in target outcome strategies finally had access to unique financial derivative instruments that had safeguarded them in the turbulent market.
And when the slow, grinding, inflation-driven selloff of 2022 arrived, one of the few years in modern history when both stocks and bonds lost double digits, derivative-based strategies again showed resilience where traditional allocations struggled. ^xxx

This was the inflection point. A decade of preparation met a moment of need. Interest accelerated. Advisors who had once been cautious began exploring derivative-led products with urgency. Institutions that previously ignored the category began studying it. The derivatization of investment products was no longer theoretical. It was now a lived experience.

Conclusion

By the early 2020s, the investment world had quietly but unmistakably changed. Derivatives were no longer buried inside structured notes or confined to hedge fund strategies. They were doing visible work inside mainstream, SEC-registered funds across income, growth, risk management, and alternatives. From derivative-income strategies (selling options to collect premium as a potential source of income) to return-stacking portfolios (using derivatives to layer multiple sources of return, such as stocks and bonds, on the same invested dollar), from Quantitative Investment Strategy implementations (rules-based strategies that use derivatives to systematically capture trends, volatility, or other market behaviors) to box-spread structures (buying or selling a specific combination of options to synthetically replicate the economics of cash or a secured loan), product developers were now using derivatives as their primary design medium rather than an exotic ingredient. Innovations in volatility targeting (adjusting market exposure up or down using derivatives to maintain a more stable level of portfolio risk), convexity management in fixed income (using derivatives to reshape how bond portfolios respond to changes in interest rates, particularly during large market moves), and commodity curve engineering (using futures and derivatives to manage exposure to the shape and roll dynamics of commodity markets rather than spot prices alone) reinforced a simple truth: derivatives had become the defining toolkit of modern investment construction.

Despite how far this transformation has already reached, we believe we are still in the early chapters. The scale of the global derivatives market is multiple times larger than the combined value of global equities and bonds. This reflects the immense utility institutions have long drawn from these instruments. As regulatory frameworks mature and fund architectures standardize, those same tools will reach an increasingly broader universe of investors.

So where do we go from here?

Derivatives are no longer hidden scaffolding beneath global finance. They are becoming the design language of investing itself. The most exciting chapters have yet to be written. Managed accounts, once the most traditional corner of wealth management, are incorporating long/short overlays, portable-alpha components, and customized hedging. Strategies in which a manager engages in a box spread to replicate the economics of secured lending at meaningfully lower rates than most traditional loans are opening an entirely new frontier in cost-efficient portfolio borrowing. We believe that retirement savers, historically constrained by legacy plan design, could integrate derivative-enabled risk management alongside traditional target-date frameworks. International markets across Europe and Asia with deep derivative ecosystems but limited packaged solutions, are beginning to adopt outcome-based products such as buffers and derivative-income strategies. ^{xxxi, xxxii} Funds are increasingly turning to bespoke over-the-counter structures, extending far beyond what is possible with listed instruments alone. ^xxxiii

Vest and other derivative-focused managers continue pushing through these barriers by architecting new wrappers, expanding market access, and translating institutional techniques into investor-aligned solutions. We are convinced that the great derivatization of investment products will only accelerate, and the result will be greater choice, greater precision, and an entirely new vocabulary for how portfolios are built in the decades ahead.
In time, investors will look back at this period not as a niche evolution but as a structural shift. A shift that fundamentally changed how risk is managed, how exposures are manufactured, and how outcomes are delivered. The forces driving this shift operated quietly for decades. They were not visible on the front page. They gathered momentum slowly, until suddenly they defined the center of gravity.

Now, that center of gravity is shifting decisively toward a world where investors do not merely accept market outcomes. They look to design them.

Disclaimer: Past performance is no guarantee of future results. The opinions and forecasts expressed may not actually come to pass and should not be construed as a recommendation ofany specific security or strategy. All content has been provided for informational or educational purposes only.

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ⁱⁱ "GDP, Current Prices," International Monetary Fund, World Economic Outlook Database, accessed October 24, 2023, https://www.imf.org/external/datamapper/profile/WEOWORLD.

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^iv Igor Zamkovsky, "Outcome ETFs – A Powerful Tool for a Changing World," BlackRock, March 27, 2025, https://www.blackrock.com/us/financial-professionals/insights/outcome-etfs.

^v Cerulli Associates, "Defined Outcome ETF Industry Could Quadruple in Assets by 2030," press release, November 19, 2025, https://www.cerulli.com/press-releases/defined-outcome etf-industry-could-quadruple-in-assets-by-2030.

^vi Simon Grima and Eleftherios I. Thalassinos, Financial Derivatives: A Blessing or a Curse? (Bingley, UK: Emerald Publishing Limited, 2021).

^vii Philippe Jorion, "Predicting Volatility in the Foreign Exchange Market," The Journal of Finance 50, no. 2 (June 1995): 507–28, https://doi.org/10.1111/j.1540-6261.1995.tb04793.x.

^viii Howard Baker, "50 Years of Exchange-Traded Options: Cboe Marks Golden Anniversary," Financial History, Spring 2023, 23,
https://static.moaf.org/docs/Cboe%2050th%20Anniversary.pdf.

^ix Carol Matlack, "Socie te Ge ne rale: Mergers Weakling Leads in Equity Derivatives," Bloomberg, November 28, 2005, https://www.bloomberg.com/news/articles/2005-11-28/societe generale-mergers-weakling-leads-in-equity-derivatives.

^x "Equity Derivatives Pay Off for Mustier," Financial News, April 17, 2006, https://www.fnlondon.com/articles/equity-derivatives-pay-off-for-mustier-20060417.

^xi Eleanor Laise, "An Arcane Investment Hits Main Street: Wall Street Pushes Complex 'Structured Products,' Long Aimed at Institutions, to Individuals," Wall Street Journal, June 21, 2006, https://www.wsj.com/articles/SB116276870300613940.

^xii Paul Graham, "Hackers and Painters," PaulGraham.com, May 2003, https://www.paulgraham.com/hp.html.

^xiii U.S. Securities and Exchange Commission, "Investor Bulletin: Structured Notes," January 12, 2015, https://www.sec.gov/oiea/investor-alerts-bulletins/ib_structurednotes.html.

^xiv Benjamin Bain, "Wells Fargo Fined by SEC Over Flipping of Structured Products," Bloomberg, June 25, 2018, https://www.bloomberg.com/news/articles/2018-06-25/wells-fargo-fined- by-sec-over-flipping-of-structured-products.

^xv Securities and Exchange Commission, In the Matter of Wells Fargo Advisors, LLC, Securities Act of 1933 Release No. 10511, Administrative Proceeding File No. 3-18556 (June 25, 2018), https://www.sec.gov/litigation/admin/2018/33-10511.pdf.

^xvi Geng Deng, Guohua Li, and Craig McCann, "Structured Products in the Aftermath of Lehman Brothers" (Fairfax, VA: Securities Litigation and Consulting Group, November 2009), https://www.researchgate.net/figure/Number-of-Structured-Products- Issued-by-Lehman-Brothers-from-January-2006-through_fig4_256010626.

^xvii Tara Siegel Bernard, "A New Way to Invest, or a New Way to Lose?," New York Times, October 20, 2010, https://www.nytimes.com/2010/10/21/business/businessspecial3/21PRODUCT.html.

^xviii Securities and Exchange Commission and Financial Industry Regulatory Authority, "Investor Alert: Structured Notes with Principal Protection: Note the Terms of Your Investment," June 2, 2011, https://www.investor.gov/introduction-investing/general-resources/news- alerts/alerts-bulletins/investor-bulletins/structured.

^xix Bloomberg Briefs, "Structured Notes: 2012 Review & 2013 Outlook," January 3, 2013, 7, https://www.slideshare.net/slideshow/structured-notes-2012-review/15842848.

^xx Seth E. Lipner, "UBS Having Hard Time With Lehman Structured Products Arbitration," Forbes, April 26, 2010, https://www.forbes.com/2010/04/26/principal-protected-notes-lehman- intelligent-investing-ubs.html.

^xxi Jonathan Stempel, "UBS to Pay $120 Million to Settle SEC Charges over Lehman Notes," Reuters, August 9, 2013, https://www.reuters.com/article/us-ubs-lehman-settlement- idUSBRE9780KP20130809/.

^xxii John Rekenthaler, "What to Know About Structured Notes," Morningstar, October 27, 2017, https://www.morningstar.com/columns/rekenthaler-report/what-know-about-structured notes.

^xxiii Karan Sood et al., "System and Method for Creating and Managing Structured Investment Products," US Patent Application 2014/0122371, published May 1, 2014, https://patents.google.com/patent/US20140122371A1/en.

^xxiv Matrix Defined Trusts 20, "Convexcel SUIT Buffered Capped Enhanced Participation Trust, Series 1," Form S-6/A (Registration Statement), May 17, 2013, SEC Accession No. 0001013228-13-001079,
https://www.sec.gov/Archives/edgar/data/1468678/000101322813001079/matrixs6 a3profinalwrap.htm.

^xxv Balaji Srinivasan, "Silicon Valley, Capital, and Globalization," The Great Exchange, podcast audio, June 3, 2025, https://podcasts.apple.com/us/podcast/silicon-valley-capital-globalization- balaji-srinivasan/id1759014294?i=1000713440301.

^xxvi "Marc Andreessen on How Silicon Valley Culture Is Changing," Mind Matters News, July 14, 2021, https://mindmatters.ai/brief/marc-andreessen-on-how-silicon-valley-culture-is- changing/.

^xxvii Securities and Exchange Commission, "Use of Derivatives by Registered Investment Companies and Business Development Companies," 17 CFR Parts 230, 239, 240, 270, and 274, Release No. IC-34084 (November 2, 2020), https://www.sec.gov/files/rules/final/2020/ic-34084.pdf.

^xxviii Jesse Pound, "Buffer ETFs Won Big in 2022. Here’s How They Work When Markets Rally," CNBC, February 9, 2023, https://www.cnbc.com/2023/02/09/buffer-etfs-won-big-in-2022- heres-how-they-work-when-markets-rally.html.

^xxix Noel Watson, "Buffered ETFs: A Solution Looking for a Problem?," Pyrford Financial Planning (blog), April 27, 2025, https://www.pyrfordfp.com/post/buffered-etfs-a-solution-looking- for-a-problem.

^xxx Katie Greifeld, "'Buffer' ETFs Post 80% Surge in Assets as Haven in Bear Market," Bloomberg, October 27, 2022, https://www.bloomberg.com/news/articles/2022-10-27/booming- buffer-funds-surf-bear-market-with-80-surge-in-assets?embedded-checkout=true.

^xxxi Nicholas Pratt, "First Trust Launches Volatility Buffer ETF in Europe," Funds Europe, May 23, 2023, https://funds-europe.com/first-trust-launches-volatility-buffer-etf-in-europe/.

^xxxii Park Ji-young, "Samsung Launches Asia’s First Buffer ETF to Safeguard Against Market Downturns," Chosun Biz, March 18, 2025, https://biz.chosun.com/en/en- finance/2025/03/18/JKNSX77CFNA4VPQUFALFCNZVJU/.

^xxxiii Nick Wodeshick, "Tap Into Derivative Demand With Autocallable ETFs," ETF Trends, October 10, 2025, https://www.etftrends.com/alternatives-content-hub/tap-derivative-demand autocallable-etfs/.