At some point, derivatives have gotten so complex and ornate that it is hard to really separate out the legitimate socio-economic utility from the mere betting utility. Synthetic CDOs (CDO news)and the CDSs (CDS news) on various tranches would appear to many as a vehicle that falls into this category. But there is demand out there for these products, on both sides. And so it is with new movie futures that are being aimed at retail investors.

According to Bloomberg, two firms, Cantor Fitzgerald and the Trend Exchange, have received approval from the U.S. Commodity Futures Trading Commission "to set up rival exchanges where traders could buy and sell securities that pay out based on how well particular movies do at the box office."

Some would like to ban such exchanges, so this may never truly get off the ground. Retail investors, in general seem to be more comfortable betting on investments beyond stocks. Currency trading among individuals has built some momentum. When it comes to movie futures, the classic argument is being revived. Some companies have a legitimate need to hedge against the failure of some movies. The other side of the liquidity equation are gamblers. We'll just have to see where this goes. 

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