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Technically the put doesn't guarantee anything since not everyone is too big to fail but for most purposes this is true.
by awad 9y ago
Technically the put doesn't guarantee anything since not everyone is too big to fail but for most purposes this is true.
- ABCLAW 9y agoNot sure why this is being voted down. A counterparty in an option agreement can become insolvent. This is typically analyzed under the name counterparty risk. Much much much less common than a stock going down, but when large counterparties become insolvent, a lot of people start needing to write off big chunks of their positions.