Trading in equities and related derivatives is booming as investors take advantage of heightened market volatility generated by the continuing crisis in the credit markets and wider economic uncertainty.

While bad news continues to flow out of the credit markets, volumes of equity derivatives, both over-the-counter and on-exchange, are running at near-record levels as participants take implicit bets on future volatility and, in many cases, try to hedge their exposure to the sudden market swings that have become the norm in recent months.