-free fiat money. The analysis concentrates on the effects of decreasing value of money, or inflation, on the rational investors …’ behavior and the asset market. The main findings are the following: Inflation does not affect the informed investors …’ prediction coefficient but makes that of the uninformed investors diminish. Inflation does not affect rational investors’ risk …

Introduction -- Volatility and its estimation -- Overview of volatility derivatives -- Options delta hedging with no … options at all -- Volatility derivatives in portfolio optimization -- Benefits of using volatility futures in investment … strategies -- Predictive properties of the volatility term structure -- Conclusions -- List of gures -- List of tables …