The credit derivatives market grew by nearly 48 percent in the first half of the year, to $12.43 trillion from $8.42 trillion, according to a new survey by the International Swaps and Derivatives Association. The year-on-year growth rate is an astonishing 128 percent, up from $5.44 trillion.

For purposes of the trade association’s survey, credit derivatives include credit default swaps, baskets, and portfolio transactions indexed to single names, indexes, baskets, and portfolios.

The notional principal outstanding volume of interest rate derivatives, which include interest-rate swaps and options and cross-currency swaps, grew to $201.4 trillion, up 22 percent from $164.49 trillion in mid-2004, according to the report. Notional outstanding volume for equity derivatives, which consist of equity swaps, options, and forwards, grew more than 16 percent to $4.83 trillion, up 28 percent from $3.79 trillion a year earlier.

“Consistently strong growth across all sectors of the business demonstrates the ongoing recognition of the benefits that derivatives offer as risk management tools,” said Robert Pickel, the association’s executive director and chief executive officer, in a statement. “This strong growth also highlights the importance of ISDA’s and our members’ efforts to improve the infrastructure of the business in order to increase operational efficiency and reduce risk.”

It also underscores the demand among some investors for potentially higher returns.

Meanwhile, Standard & Poor’s noted in a recent report that investors in some complex structured credit derivatives could be more at risk from a single corporate default than they expect, according to the Financial Times. The credit-rating agency reportedly noted that the instruments do not offer the diversification-related protection that investors expect from other types of assets.