A hybrid neuro fuzzy decision-making approach to the participants of derivatives market for fintech investors in emerging economies

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Rahadian D., Firli A., DİNÇER H., YÜKSEL S., Mikhaylov A., Ecer F.

Financial Innovation, vol.10, no.1, 2024 (SSCI) identifier

  • Publication Type: Article / Article
  • Volume: 10 Issue: 1
  • Publication Date: 2024
  • Doi Number: 10.1186/s40854-023-00563-6
  • Journal Name: Financial Innovation
  • Journal Indexes: Social Sciences Citation Index (SSCI), Scopus
  • Keywords: Decision making, Derivative investments, Efficiency, Financial innovation
  • Istanbul Medipol University Affiliated: Yes


The risk profiles of investors play an important role in the success of derivative products investments. It is also necessary to determine the appropriate investor profile according to the conditions of a country. This protects investors from major losses. Therefore, there is a strong need for a new study that analyzes the risk profiles of derivative products in emerging economies. This study aims to identify the most appropriate investor risk profile for derivative instruments in emerging economies. It constructs a novel decision-making model. In this model, the facial action coding system, quantum theory, spherical fuzzy sets, and multi-stepwise weight assessment ratio analysis (M-SWARA) methodology are integrated to minimize uncertainty in this process. First, three main participants of derivatives for financial technology investors are evaluated using the quantum spherical fuzzy M-SWARA technique. After that, seven emerging economies are ranked based on this performance using quantum spherical fuzzy technique for order of preference by similarity to ideal solution. The main contribution is that an appropriate investor profile is identified for financial derivative investments in emerging economies. One of the important originalities of this study is the development of a new technique called M-SWARA by making some improvements to the classical stepwise weight assessment ratio analysis method. It is concluded that hedging is the most appropriate purpose for making investments in derivative products in emerging economies. It is also identified that China has the greatest performance among the seven emerging economies regarding the appropriate purpose for making derivative investments. For the effective management of this problem in these countries, it is recommended to prevent the speculative use of derivative products with legal regulations.