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According to L.A.BOROING and A.Y.CHMAKOVA in the article Explicit solutions for a nonlinear model of financial derivatives Families of explicit solutions are found to nonlinear Black-schools equation which incorporates the feedback effect of a large trader in case of market illiquidity. The typical solution of these families will have a payoff which approximates a strangle. These solutions were used to test numerical schemes for solving a nonlinear Black-Sholes equation. Reference: International journal of theoretical-2007. According to PAUL DAWSON in A new use for single stock futures , The varianceminimising and utility-maximising hedging strategies presented in the literature are not necessary optimal for an overseas investor, because they fail to discriminate between the sources of variance. An equity investors is likely to be quite willing to assume the equity risk, but very keen to hedge the foreign exchange risk. Furthermore the variance-minimising and utility-maximising hedging strategies embed a paradox. Effective implementation calls for accurate forecasting skills: those who are capable of such accurate forecasting have relatively little requirement to hedge. Reference: International journal of theoretical-2006 Nov20. According to JEDRZEUJ BIALLEOWSKE and JACK JALLUBOWSKE in determinants of trading activity on the single stock futures market: in that they described important variables contributing to high trading activity includes factors relating to the market for the underlying stock, such as trading volume, market capitalisation and volatility: characteristics of the futures contract including tick and contract size characteristics of the firms home country and such other factors as the degree of institutional ownership of the underlying stock and the extent of arbitrage opportunities due to futures mispricing. The results confirm the importance of most of the hypostasized relationships. In addition, the authors look closely at a specific divided capture strategy using SSFs that should be especially attractive to germen investors. They find that the behaviour of SSFs around ex-dividend day show clear evidence that a substantial volume of trading activity appears to be generated by traders implementing this strategy.

Reference: evidence from the Eurex exchange: 2012 VOL 19. According to ANDRE BERTOLOTTI in the article Tracking EAFE with index futures portfolios-1994. In this article he says that the futures only tactic can be improved by adding stocks to the portfolio to cover more countries and to diversify the within market position also, the implicit currency exposures could be hedged by knowing the portfolio characteristics and performance a clever manager may be able to use the advantages of index futures to improve overall portfolio performance.