> Who is the counterparty to these trades? Typically large trading firms, market makers. > When the market sentiment is negative, the number of these counterp

> Who is the counterparty to these trades? Typically large trading firms, market makers. > When the market sentiment is negative, the number of these counterparties are narrow and dwindling That's why his $2600 initial investment made in a much calmer market is now worth $310k :) For the right price you'll find somebody willing to sell you the insurance you seek. But in a volatile market like today, that price may be way too much for most people.